Power price protests

This was bound to happen: people taking to the streets in frustration at the gap between what they earn and the utility bills they are now having to pay. With working-class homes now struggling to pay for even a light bulb and a couple of fans, the Pakistani street could see more protests in the days ahead. The caretaker government – which was essentially supposed to just come in, hold elections, and leave – is now going to have to figure out a way to do something (anything) to make things better, if not right. Looking at the escalating protests, Caretaker Prime Minister Anwaar ul Haq Kakar has summoned an emergency meeting at the Prime Minister’s House today. The forum will include briefings from the Ministry of Energy (Power Division) and distribution companies. According to Kakar, this is meant to come up with a way to provide maximum relief to consumers regarding inflated power bills. In July, the then federal cabinet gave its go-ahead to a massive increase in the base tariff of electricity by up to Rs7.50 per unit against the national average tariff determination of Rs4.96 by the power regulator National Electric Power Regulatory Authority (Nepra). The regulator had hiked the tariff to increase revenue collection for the loss-making power distribution companies (Discos) during the current fiscal year. According to a Nepra statement, the revised national average tariff for the 2023-24 fiscal year has been determined at Rs29.78 per unit kWh, which is Rs.4.96 per unit higher than the previously determined national average tariff of Rs24.82.

The government, economists, and policymakers may have all the data in their arsenal to support what are debilitating times for the people, but no statistic can help a family that has to choose between bare nutrition, children’s education and an electricity bill. In this, the protests are understandable given that inflation is at an all-time high, food inflation is through the roof and with the recent fuel price hike, prices of everything have risen in tandem. From school fees to the prices of everyday necessities, from transport to indirect taxes, the living cost of people has increased manifold, making lives difficult for all segments of society. While it was known that ‘tough decisions’ had to be taken due to the IMF programme, these tough decisions had to be planned out. The people of the country are paying for years of bad policy, dithering by the previous government’s finance ministry, and a general apathy of the ruling elite towards what real people in this country go through. Why is it that the government has not thought of targeted subsidies for people, especially when these are not even something the IMF would oppose as compared to cross-subsidies?

Over the last two years, prices have been gradually increasing and Pakistan has been on the verge of default due to the mismanagement and indecision of the previous PDM government. From the days of Covid, when a lot of people lost their jobs, things have been in a downward spiral in Pakistan. Our economy has not stabilized at all. Healthcare costs have increased, we face gas shortage every year in the winter, we face loadshedding every summer, public education is in shambles. Economic experts say that when it comes to electricity tariff, taxes and surcharges make up almost 29 per cent of the tariff. The government needs to find a way to at least reduce these taxes and government charges. Transmission and distribution is one of the most inefficient components of our power system and no government – PTI or PDM – worked on this issue in the last five years. Power experts also say that DISCOS should be privatized. The government needs to bring in complete energy reforms, including encouraging clean and renewable energy policy, which should not be just on paper and is actually easy and smooth for the general public. The other measures that the government should take is expanding the distribution and transmission of energy, making sure that line losses are managed, and electricity theft is controlled. These may seem like big asks but they are not. When your people are on the streets literally begging for relief, you cannot hide behind policy terms and excuses. Something’s got to give.