Flat tariff regime: Massive relief to power consumers on the cards

ISLAMABAD: In a welcoming development, the government is all set to introduce flat tariff regime for electricity consumers having ToD (Time and Day) meters at Rs11.97 per unit for four months of winter reason.

It will not only give a substantial relief to masses but also help the government get out of capacity payment trap of Rs849 billion as the idle power projects will also be utilised in the winter season.

“We have prepared a summary for ECC and will be taken for approval in next week and the new flat tariff regime will be enforced from November, 2019 to February 2020,” one of the top officials at Power Division told this to The News.

At present the electricity consumers having ToD meters are currently experiencing two tariff regimes; one is peak hours tariff and other one is off-peak tariff.

“Yes, we are going to offer flat tariff at Rs11.97 to the domestic and commercial consumers using electricity through ToD (Time of Day) meters. In addition, the industrial consumers of B1, B2 will also be extended the flat tariff of Rs11.97 per unit,” Joint Secretary (Power) at Power Division Zargham Eshaq Khan confirmed to The News.

The base tariff that Nepra has determined would not be affected and the revenue will also not be affected in the said four months of the winter season.

Giving the background of the decision, Mr Khan said that the challenge of the government is to pay mammoth amount of Rs849 billion during this financial year in the head of capacity charges to power plants (IPPs) and when the power plants become idle on account of massive reduction in demand for electricity in winter season, the capacity payment per unit stands at Rs4.94 per unit and when the power projects become operational and the electricity will be used even in winter season at the maximum that will also increase the commercial and industrial activities apart from the raise in electricity consumption in the domestic sector. And this will result in reduction of the capacity payment charges to Rs3.05 per unit that power consumers pay.