he national power grid is currently facing some daunting demand-side challenges. Most of these stem from the unaffordable price of electricity. Many consumers—domestic, commercial, agricultural or industrial—can no longer continue to sustain their electricity use at the suggested prices.

In some cases, consumers have complained that their power bills now amount to almost all of their monthly spending, leaving nothing for other expenses, including food and shelter. This has triggered widespread discontentment that could potentially spiral into civil unrest.

A report published in a national daily on June 27 said a labourer in Bahawalnagar district, fearing a power bill the family could not afford, beat up his wife for switching on a ceiling fan. Minchinabad police have arrested the man. The FIR says the wife had switched on the fan for some relief from the hot and humid conditions. However, the husband turned it off saying that they could not afford the high electricity cost. Seeing the discomfort of the children, the wife again switched the fan on. This time, the husband struck her with a club and broke her nose.

In some cases, suicide attempts, including self-immolation have also been reported.

The consumers are particularly angry at the taxes included in the electricity bills. More than a dozen taxes are now included in the power bill. To any rational person, adding another tax when the energy cost is already high might look unreasonable.

A worrying aspect of the high electricity charges is that they are affecting households as well as businesses. For an average household, a five-figure electricity bill, around the year, is now common.

For businesses, it is even worse. A vegetables vendor who plies his wares on a cart, is now being charged thousands of rupees a month for a single electric bulb for his storage space.

The case of small shops is no different. Many of these shops are receiving bills of around Rs 50,000 a month, which translates to Rs 1,500 to Rs 2,000 per day. Imagine a shopkeeper who hardly makes Rs 5,000 to Rs 7,000 daily and how they can continue paying their power bills.

If a shop keeper has a fridge or a freezer in the shop, his monthly bill now exceeds Rs 70,000 a month. Owing to the high cost of power and the small margins on many products, these traders find themselves between a rock and a hard place.

“If I sell a packet of milk or yogurt kept in a fridge, I earn Rs 10 to 15 against a sale of over Rs 250 or up to Rs 370,” bemoans Muhammad Shafiq, a small trader running a shop in Lahore’s Garden Town. He says that there is no forum at metropolitan or provincial level where such issues can be raised. “We are left at the mercy of powerful manufacturers of various daily use items who do not allow for the cost of cooling or pay any part of our power bills. They are not willing to share their profits with the supply chain. With low margins, you cannot survive with low sales and the high-cost energy,” he laments.

This is perhaps why many small shops have closed down recently.

Talking about role of the government, he says, shopkeepers are being asked to help increase tax collection through power bills and their sales. Shafiq suggests that if the government reduces sales from the current Rs 70 (18 percent) to Rs 50 (13 percent) on a litre pack of milk, it will help increase small trader’s margin from Rs 15 to Rs 35. “How can the dream of inclusive growth be realised if small traders are not given their share by the government or the manufactures?”

Meanwhile, millions of households are in sheer distress across the country due to inflated power bills.

The financial difficulties of various segments of society have been greatly exacerbated in recent times. During the last couple of months or so, there have been back-to-back upward revisions in power tariff. In a recent move, the federal cabinet has approved significant increase in the electricity tariff for residential consumers using 100 to 500 units. The basic pre-tax tariff has now been fixed at Rs 48.84 per unit. It will be Rs 57.63 per unit after sales tax. With fuel price adjustments and some taxes, the maximum electricity tariff will exceed Rs 65 per unit. Fixed charges for ‘protected’ consumers have also been enhanced significantly. The cost of new meters has also increased.

Minister for Power Awais Leghari conceded recently that electricity prices were high in the country. He said the government will be able to provide cheaper electricity to consumers in about 18 months following certain reforms.

“Given the rates of average hike proposed last June, Prime Minister Shahbaz Sharif said he would not put the entire burden on the people. He said the burden of Rs 5.72 per unit has been placed after injecting subsidies of Rs 440 billion by the government.” The minister said the impact of price adjustment for protected consumers was around 2 percent.

The government has also announced relief for the so-called ‘protected’ power users for the next three month. Many believe that this intervention is too little and too late.

Industrial sector has also been promised significant reduction in power tariff.

Falling real incomes and rising energy costs are altering the fabric of the society by stoking social unrest as millions of people are pushed below the poverty line. The very foundation of the state is being weakened. This could trigger a much bigger crisis if not dealt with urgently.

The writer is a senior reporter at The News