Govt plans to introduce more slabs for electricity consumers

ISLAMABAD: The government is making its mind to introduce more slabs for electricity consumers to ensure the implementation of targeted subsidies in the next budgetary year 2021-22.

“Yes, we are working on it and will carve out slabs starting from 200-300 units 301-400 units, 401-500 units, 501-600 units and 601-700 units and so on for ensuring the targeted subsidy,” SAPM on Power and Petroleum Mr Tabish Gauhar confirmed the development.

He said that right now the consumers who use 301 units and 699 units are getting the same subsidy which is taking a heavy toll on the government national exchequer. “The decision for more slabs will help create new categories of electricity tariffs for consumers and will help reduce the volume of subsidy too.” Tabish said that the targeted subsidy regime in electricity tariff will be implemented in two phases and under the first phase there will be no raise in tariff but under the second phase, there will be a marginal increase in tariff.

However, the relevant official sources said that with the implementation of new targeted subsidy regime, almost eight million consumers will be out of the subsidy net. At present, 22 million electricity consumers are getting the subsidy. However, it will be contained to 13.9 million consumers. And around Rs42 billion would be saved per year in subsidy expenditure.

They said that the slab of 301-700 units will be divided into four slabs that include 301-400, 401-500, 501-600 and 601-700 and all power distribution companies (DISCOs) will be requesting National Electric Power Regulatory Authority (Nepra) to make changes in the tariffs of the new category of electricity consumers keeping in view the targeted subsidy. And all will be done after the decision about quantum of the amount to be budgeted as subsidy for next fiscal 2021-22.

To a question official sources said that Power Division wants the budgeted allocation of Rs500 billion as subsidy for power sector for next financial year 2021-22 and to this effect it has desired from Finance Division the Rs500 billion for subsidy but the Finance Ministry is willing to budget the amount of Rs310 billion.

The federal government, the official sources said, will request the Nepra on behalf of power distribution companies (DISCOs) to create a new category of protected customers, which include those consuming 200kWh in a billing month and consistently consumed 200kWh for the past six months. And the two tariff rates for 50 and 100 units will continue.