According to SRO 1037 issued by the Ministry of Energy (Power Division), Karachi’s power tariff has been brought at par with the rest of the country and Karachi’s power consumers will now pay the same rate for electricity as consumers of other DISCOs, as per the Government of Pakistan’s (GoP) uniform tariff policy.
The increase, which has also been ratified by the Cabinet Division, will not be applicable on the most vulnerable consumer segment (non-ToU residential consumers’ usage up to 300 units per month). As such around 1.5 million consumers, will not be impacted by this notification.
Earlier, in Dec 2019, the National Electric Power Regulatory Authority (NEPRA) had approved an increase of PKR 4.87 per kWh, in the determined electricity tariff for K-Electric. However, as per uniform tariff policy of Government, the Economic Coordination Committee of Cabinet (ECC) in its meeting held on March 26, 2020, decided that maximum impact on customers of K-Electric will be up to PKR 2.89 per unit to ensure that their consumer end tariff remains the same across Pakistan, while the rest of the increase will be adjusted via Tariff Differential Claims.
The actual increase ranges from Rs 1.09 to Rs 2.89 for different categories of consumers and will come into effect from September 1, 2020. The increase will not be applicable on the most vulnerable consumer segment (non-ToU residential consumers’ usage up to 300 units per month). This makes up more than half of KE’s total consumer base of about 2.5 million. Until this increase, the tariff for K-Electric consumers was lower than that of other DISCOs, which has now been aligned with rest of Pakistan as per GoP’s Uniform Tariff Policy.
The tariff increase has been on the basis of quarterly adjustments as determined and recommended by NEPRA. This determination is as per a mechanism provided in the multiyear tariff for quarterly adjustment for legitimate expenses such as power purchase price, operation and maintenance costs, and adjustment of transmission & distribution losses for eleven quarters from July 2016 to March 2019, and is claimed as per routine by all DISCOs across Pakistan. This is not an added benefit to KE as the power utility has already incurred these expenses over the said period.
