ISLAMABAD: Pakistan’s power consumers face a Rs33.78 billion quarterly tariff adjustment, including a potential Rs1.34 per-unit increase, despite government efforts to renegotiate independent power producer agreements, as distribution companies blame solarization, lower farm demand and an unusually cold April for falling electricity sales.
At a public hearing on the Central Power Purchasing Agency-Guarantee’s (CPPA-G) petition, the National Electric Power Regulatory Authority (Nepra) was told that domestic and commercial electricity consumption had declined across the distribution companies.
Of the total demand, Rs46.380 billion was in capacity charges, Rs4.974 billion in variable O&M costs and Rs3.08 billion for transmission and distribution losses. These were partly offset by Rs13.517 billion under UoSC Ministry of Finance and Rs21.175 billion under the Incremental Consumption Package. The companies also claimed Rs14.231 billion in unrecovered SPP/CPP costs. SEPCO sought the highest net adjustment at Rs13.724 billion, followed by PESCO Rs6.294 billion, FESCO Rs5.358 billion, MEPCO Rs5.090 billion, GEPCO Rs4.992 billion, IESCO Rs4.872 billion, LESCO Rs2.953 billion and HAZECO Rs1.239 billion. TESCO showed a negative adjustment of Rs4.394 billion, QESCO Rs3.647 billion and HESCO Rs2.083 billion.
The hearing exposed the growing impact of solarisation. QESCO has largely escaped the capacity-payment cycle after agricultural tubewells in Balochistan shifted to solar, while MEPCO said nearly half its agricultural tubewells in Punjab are on its system and many have also switched to solar, sharply reducing sales.
All Discos reported declining domestic sales due to solarisation. FESCO reported a 5 per cent drop in sales, although industrial consumption rose 2 per cent. IESCO reported sales decline and acknowledged that capacity payments accounted for a major part of its adjustment.
Discos also admitted imposing nighttime loadshedding because they cannot economically sell expensive grid electricity at existing tariffs despite consumers continuing to pay their bills.
The government has sought to slow solar adoption by replacing the old net-metering mechanism with net billing, ending the exchange of electricity units. However, the hearing showed that the policy has not halted the shift to solar.
Industrial representatives rejected higher tariffs, warning that increased electricity costs would further burden industry during wartime.
A Nepra member said solarisation had actually prevented worse loadshedding, while acknowledging that Discos are now shedding load at night because solar has reduced daytime demand.
The development highlights Pakistan’s growing dilemma: consumers are buying less grid electricity but remain liable for the fixed costs of power plants, including idle capacity.
