Govt announces Rs1.95 increase in electricity unit price

Federal Minister for Energy Omar Ayub announced increasing the per unit price of electricity by Rs1.95 on Thursday, citing decisions made by the former Pakistan Muslim League-Nawaz (PML-N) government as the reason for the raise in tariff.

Ayub’s announcement came during a presser held with Minister for Planning and Development Asad Umar and Special Advisor to Prime Minister on Power Tabish Gauhar in Islamabad.

“We are going to have to take the price of electricity up by Rs1.95 due to the flawed policies of the previous government in the energy sector,” Ayub said.

“The previous government planted landmines for us with its policies, causing for us to fall in trouble as we try to manage the affairs of the country,” Ayub said, adding that, “If we look at their policies, the increase in the power tariff stands at Rs2.18 per unit.”

Also read: Govt set to raise power tariff in January: SAPM

The minister further said, “We have to somehow overcome the deficit left behind by the PML-N government, and adding that, “We have to make this decision to ensure that the industries continue to function.”

Furthermore, SAPM Gauhar informed that the government will be shutting down gas supply to power-linked units of the country from February 1. “Agreements with the IPPs [Independent Power Producers] regarding ‘take and pay’ clause will end by the first of next month,” he stated.

Gauhar also announced that the government will shut down the old power plants with a capacity of 3,500 megawatts.

“The past few years have witnessed a drop in the demand for electricity,” the SAPM added. “We are going to initiate a dialogue with the provinces regarding power theft and bill recoveries,” he further observed.

Addressing the presser, Asad Umar said, “We had to face problems related to exports due to the previous regime, but a positive outcome is that the exports are witnessing a recovery while the economy is also on an upward trajectory due to the policies of the incumbent government.”

The planning minister said Pakistan’s economy has been witnessing an uplift for the past few months and that there has been uplift in the growth and production of the industries.

Umar went on to add that the current account is now in surplus, not under deficit, maintaining that the incumbent government inherited the issues relating to power from the previous rulers.

“The government decreased the power tariff for the industries,” he said.

The increase in per unit price came following Gauhar confirming, on January 16, that the federal government was all set to raise electricity tariff amount to roughly Rs2 from this month.

He confirmed that the power tariff “increase is inevitable” in January as it was one of the major conditions laid by the International Monetary Fund (IMF) for the revival of $6 billion aid programme and the need of the power sector.

About a month ago, on December 18, Prime Minister Imran Khan had given the go-ahead to increase electricity prices aimed at fulfilling a major condition of the International Monetary Fund (IMF) for the revival of $6 billion programme that remained suspended for the last 10 months.

The electricity prices could go up by 25% or Rs3.34 per unit on account of annual base tariff increase of the previous fiscal year, sources in the Ministry of Energy and Ministry of Finance had told The Express Tribune then.

(This story has been published from The Express Tribune feed, without modifications to the text)