Upto 26% Increase In Power Tariff Is Expected
Upto 26% Increase In Power Tariff Is Expected: The Economic Coordination Committee (ECC) of the cabinet, scheduled to meet on Tuesday, is likely to approve an increase of up to 26% in power tariff for different categories of consumers.
Officials of the Ministry of Energy (Power Division) said the power price hike was necessary because of the fresh tariff determined by the National Electric Power Regulatory Authority (Nepra) which was higher by Rs3.82 per unit.
The tariff is being revised upwards also because of the rise in the cost of electricity generation following addition of new capacity and increase in net hydel profit payments.
Despite the tough financial situation – circular debt of more than Rs600 billion and a minimal fiscal space – emphasis has been laid on protecting the interest of low and middle-income groups along with agriculture and industrial sectors.
The Power Division has proposed no change in the tariff for domestic consumers using up to 50 units per month who account for 4.5% of total consumers. Those using up to 100 units, who are 26% of consumers, may face an increase of Rs0.87 per unit, while those using up to 200 units, which are 24% of the total, may see a hike of Rs1.22 per unit.
For consumers using up to 300 units, who are 20% of total users, the tariff rise will be Rs2.04 per unit.
The Power Division has recommended the ECC not to hike tariff for agricultural tube wells. It has suggested a minimal increase for commercial consumers of up to 5 kilowatts, continuation of Rs3-per-unit subsidy for all industrial consumers and an additional subsidy for the export-oriented industry.
It has also proposed no change in the tariff for general services including schools and hospitals.
According to the Power Division, if no increase is made for any slab of domestic consumers, an additional subsidy of Rs82 billion will have to be borne. However, if no increase is made for domestic consumers of up to 200 units, then the additional subsidy impact will be Rs27 billion.
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