The National Electric Power Regulatory Authority (NEPRA) has indicated a potential reduction of Rs1.80 per unit in electricity prices under the Quarterly Tariff Adjustment (QTA) for the quarter ending June 2025. If approved, this adjustment could provide financial relief amounting to Rs53.393 billion to consumers across Pakistan.
The proposal was discussed during a public hearing at NEPRA headquarters on Monday, where representatives from the Central Power Purchasing Agency (CPPA-G), distribution companies (DISCOs), the business community, media, and general consumers shared their views. CPPA-G submitted the request on behalf of ex-WAPDA DISCOs to refund surplus funds under the QTA for the April-June 2025 quarter.
NEPRA was informed that the primary driver behind the proposed relief is a significant reduction in capacity payments by Rs53.714 billion. Additionally, improved transmission and distribution (T&D) efficiency contributed to a further reduction of Rs662 million. However, these savings were partially offset by small increases in Operation & Maintenance (O&M) costs and Use of System Charges (UoSC) and Market Operation Fees (MoF), which rose by Rs182 million and Rs804 million, respectively.
During the proceedings, NEPRA officials were updated on the power sector’s circular debt, which has decreased by Rs780 billion over the past fiscal year, from Rs2,300 billion to Rs1,600 billion. This reduction was attributed to better performance by DISCOs, saving Rs200 billion. However, the closure of the Neelum-Jhelum Hydropower Plant negatively impacted the sector by Rs18 billion.
Officials also highlighted a 31% average increase in electricity consumption among DISCOs, excluding Quetta Electric Supply Company (QESCO), which reported a decline. NEPRA raised concerns about the growth in industrial consumption, but DISCO CEOs could not provide satisfactory explanations.
The government is working on reforms related to both direct and cross subsidies. Officials clarified that the Rs1,275 billion raised through bank loans to manage power sector liabilities would not require a separate surcharge for repayment.
If NEPRA approves the proposed adjustment, the relief will apply to all DISCO consumers, including those served by K-Electric, except lifeline users, prepaid meter holders, and electric vehicle (EV) charging stations. This is in line with the federal government’s policy of maintaining a uniform power tariff nationwide.
Among the DISCOs, Faisalabad Electric Supply Company (FESCO), Lahore Electric Supply Company (LESCO), and Multan Electric Power Company (MEPCO) requested the highest refunds, at Rs15.03 billion, Rs12.64 billion, and Rs8.47 billion, respectively. In contrast, QESCO requested a positive adjustment of Rs3.594 billion due to higher capacity payments and operational costs, reducing the total refund amount from Rs56.987 billion to Rs53.393 billion.
For context, NEPRA allowed a recovery of Rs1.7432 per unit, or Rs43.23 billion, under the QTA for the same quarter of FY2023-24. NEPRA stated that a final decision will be issued after further scrutiny of the data submitted.
If approved, the adjustment would offer much-needed relief to consumers facing high inflation and rising living costs.
