Government Ready to Hike Power Tariff to Please IMF
The measure will help the government to collect a whopping Rs 878 billion from power consumers
In order to restore IMF program, the government has approved to increase the power tariff by Rs 6 during the next two years.
The measure will help the government to collect a whopping Rs 878 billion from power consumers.
Breakdown of increase
The government has promulgated NEPRA Act through an ordinance.
The ordinance will give powers to the government to impose a new surcharge equal to 10% of the electricity revenue requirements or Rs1.40 per unit.
The government will hike the power tariff by Rs 4.60 in three phases.
Until June, the power tariff would be hiked by Rs 2.55 per unit and the price per unit will become almost Rs 19.
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In 2022, the electricity tariff would be increased by another Rs 1.50, and a unit will cost Rs 20.49.
The price of a unit will surge to Rs 21.4 and the addition of surcharge and other taxes would shoot the prices to Rs 26.78 per unit.
Cut in subsidy
The federal government is also formulating a strategy to limit subsidy on power tariff under conditions set by International Momentary Fund (IMF).
The slab for power consumers getting subsidized rates would be further reduced from 300 units.
The government will also commit not to spend more than allocated funds for power subsidy in the budget and would shift the burden of hiked fuel prices used for power generation onto consumers.
