Public anger against inflated electricity bills prompts PM to call emergency meeting

Published August 26, 2023
Donkeys carry electricity bills of Multan protestors as they chant slogans against Gujranwala Electric Power Company. — Dawn TV
Donkeys carry electricity bills of Multan protestors as they chant slogans against Gujranwala Electric Power Company. — Dawn TV

People in different parts of the country on Saturday expressed despair and anger at unprecedentedly high electricity bills with some threatening demonstrations and even a civil disobedience campaign if the extra taxes weren’t deducted.

The severe reaction led caretaker Prime Minister Anwaarul Haq Kakar to call an emergency meeting at the Prime Minister’s House tomorrow (Sunday).

“In the meeting, a briefing will be taken from the ministry of power and distribution companies and consultations will be held regarding giving maximum relief to consumers regarding electricity bills,” the premier said on X (formerly Twitter) today.

Last month, the power regulator raised the national average tariff by around Rs5 per unit, pushing the base unit power tariff from Rs24.82 to Rs29.78. On Aug 22, the government once again sought to raise the power rate by Rs3.55 per unit.

Hours after the interim PM’s announcement today, caretaker Minister for Information and Broadcasting Murtaza Solangi, along with Federal Secretary of the Power Division Rashid Mahmood Langrial, held a media briefing in Islamabad to explain the current state of electricity tariffs.

At the outset of the briefing with anchorpersons and bureau chiefs from various media outlets, the minister acknowledged the difficulties faced by the people due to the escalating electricity prices.

He said all stakeholders within the power sector would participate in the prime minister’s emergency meeting.

The Power Division secretary confirmed that the facility of free electricity units to officers of power distribution companies would be discontinued, insisting that the burden was not being transferred to regular bill-paying individuals.

Langrial explained that the National Electric Power Regulatory Authority (Nepra) determined electricity tariffs using three distinct methodologies, adding that the Rs5.40 per unit additional quarterly tariff adjustment (QTA) for April-June was meant for new power plants.

Moreover, he said electricity prices were subject to fluctuations based on the Consumer Price Index.

The secretary also elaborated on the necessity of tariff alterations due to the upsurge in the Karachi Inter-Bank Offered Rate or Kibor rate — which are quoted on a daily basis by a large number of banks to indicate the cost of borrowing and lending money for tenors ranging between one week and 3 years.

In addition to this, fuel price adjustments also impacted electricity costs, Langrial added.

The secretary said in the fiscal year 2023, the tariff was initially set at Rs195 per dollar, but the value of the dollar surged to Rs284.

“We initially aimed to set the price of RNLG (regasified liquefied natural gas which is used as fuel for electricity generation) at Rs3,183 per mmBtu, however, the actual price ranged between Rs3,000 and Rs3,800,” he said.

Similarly, the secretary said the price range for imported coal remained between Rs51,000 and Rs61,000 per metric tonne.

He further said that Rs2 trillion would be exclusively allocated to capacity payments in the upcoming year.

The secretary insisted that the increase in electricity tariffs predominantly affected consumers utilising more than 400 units, adding the tariff remained unchanged for 63.5 per cent of domestic consumers.

For 31.6pc of domestic consumers, he said electricity prices saw an uptick of up to Rs6.5 per unit, and a tariff of Rs7.5 per unit was only applied to 4.9pc of domestic consumers.

Langrial asserted that the average tariff increase for domestic consumers stood at Rs3.82.

In July 2022, the highest recorded electricity tariff was Rs31.02 per unit, he said, adding that by August 2023, the price had increased to Rs33.89 per unit.

The press conference was held against the backdrop of countywide protests against exorbitant electricity bills.

Rawalpindi

In Rawalpindi, a large number of people protested at Rawalpindi’s Liaquat Bagh against the high electricity bills. They held banners and placards while chanting slogans against the local electricity provider.

“Our bill has doubled. I don’t have my bill in hand right now but this time our bill was Rs84,000. When I sent my son to get it fixed, they adjusted the bill to Rs54,000. If you are increasing this bill because the IMF asked you to do so, it is still wrong,” one protester said.

“There is no notification from the government and these Wapda and all [electricity suppliers] are increasing it at their own whim,” he added.

Another angry protester said: “Our next move will be a strike throughout the country from Karachi to Peshawar by the traders community.”

He added some protesters told him that if the taxes weren’t taken back, they would move towards Islamabad and start a civil disobedience campaign.

Islamabad

A visibly annoyed resident of the capital city told DawnNewsTV that he was in no position to say anything and the government’s increase in electricity taxes had rendered him “speechless”.

“Last month my bill was Rs38,000 and after many hardships I paid it. Now it is Rs48,000. We can neither live nor die. The government has snatched all our happiness away from us,” he said.

Meanwhile, a day earlier, the Islamabad Electric Supply Company (Iesco) wrote a letter to the chief police officer seeking police protection for its staff and property fearing adverse reactions from electricity consumers in different localities in the garrison city.

In a letter to the CPO, the superintending engineer (SE) said that consumers were visiting different offices of Iesco in mobs and groups to protest against the increase in electricity bills. The employees of the distribution company feel insecure while performing their duties, he said in the letter. The SE termed the situation alarming which may lead to a law and order situation and protesters may damage property and installations.

Peshawar

A cobbler identifying himself as Hameedullah said his daily earning was Rs600 but he was charged with a bill of Rs16,424. “We have three lights, four bulbs, and one fridge in the house,” he said. Pointing to his inventory, he added: “This is [worth] Rs6,000. I don’t have any more money.”

Fearing the protests, the Peshawar Electric Supply Company (Pesco) has directed its staff to refrain from putting non-essential and “green number plate” vehicles on the roads till the “normalisation of the law and order situation”.

Lahore

An exasperated rickshaw driver lashed out at the government saying: “First my bill used to be Rs2000-Rs2500 and now it is Rs10,300. Where should we go to clear this?

“I don’t even earn this much. How should I pay for this? My daily wage is Rs1,000-1,200 out of which we pay Rs500 for petrol. Running a stove at home costs between Rs500-Rs600. Where should we go? This inflation has destroyed us. We just have one energy saver at home that runs throughout the day and night.”

People display their inflated electricity bills in Lahore. — DawnNewsTV
People display their inflated electricity bills in Lahore. — DawnNewsTV

Separately, activist Ammar Ali Jan announced on X that a campaign against electricity bills in Lahore would be held tomorrow.

“We need coordinated action across the country to demand relief for salaried class and ending privileges worth $ 17.4 billion annually for the elites. If people fight back, they will win,” he said.

Meanwhile, DawnNewsTV reported announcements urging consumers not to pay electricity bills were made from mosques in different areas of Wazirabad.

Karachi

A shopkeeper in Karimabad Market explained that the main problem was that there wasn’t much business these days. He added that there were new bills every day. “Should we pay the bills or buy groceries for home? Our children are also very worried.”

He said he was left with no choice but to protest.

Dawn.com staffers also raised similar concerns. One staffer said his bill amounted to Rs12,000 this month. He urged the government to think differently and find a way to despite the current IMF agreement as consumers can’t pay extra taxes on bills amidst exorbitant prices of necessities.

On Thursday, reports of traders allegedly attacking K-Electric employees at a market in Karachi emerged. KE CEO Moonis Alvi later confirmed the same on X (formerly Twitter) and demanded that a first information report be registered against the attackers.

Quetta

A daily wage labourer at Meezan Chowk told DawnNewsTV that these days work opportunities were “really few” as cement and steel had become expensive. He also posed the same question that others asked: whether he should pay his bill or fulfil the need for groceries at home.

“Please for the sake of God, control the inflation. I’m very worried,” the daily wage earner bemoaned.

Multan

The protests in Multan were emotionally charged. Protesters tied their electricity bills to donkeys as they marched towards the Gujranwala Electric Power Company (Gepco) while chanting slogans against the government.

— DawnNewsTV
— DawnNewsTV

K-Electric responds

In an audio message broadcast on television, KE spokesperson Awais Rasheed Munshi could be heard saying: “We understand that many conversations and arguments are taking place between people throughout the country regarding the rising electricity prices.

“People might be getting angry while being worried. Pakistan’s electricity system works in a regulated environment. This falls under Nepra and power ministry. K-Electric’s work is related to performance, profit, and loss.

“When the prices of electricity rise, the company doesn’t make any profit. K-Electric and no other distribution company have any part to play in the rising prices and taxes,” he said.

‘Sheer cruelty’

On Friday, people from all walks of life took to the streets in Karachi, Gujranwala, Peshawar, Toba Tek Singh and other areas against exorbitant power bills. They blocked roads, set fire to power bills and announced they would challenge the “injustice” by the public utility in the court of law.

Speaking to DawnNewsTV today, one person deemed the taxes imposed by the government as “sheer cruelty”, adding that he would be old by the time he paid off his entire electricity bill.

“The bills are so high that we are unable to pay the school fees of children,” he said. “If a person is living in a rented house, he has to decide either to pay the rent or the electricity bills.”

Meanwhile, former parliamentarian Nafisa Shah called the electricity bills “backbreaking” and “unacceptable”.

“Why should the people of Pakistan suffer for the poor policies of rulers? Even now the lesson has not been learnt as Pakistan is going for expensive nuclear energy when cheaper options, solar, hydel, wind and local coal, are available,” she said on X.

Situation

The rising electricity costs appeared to have put the power companies in a vicious cycle of declining consumption and shifting resultant additional capacity charges to consumers, compelling the government to seek the staggered imposition of Rs146 billion quarterly charges in six months, instead of three months to minimise the ‘price shock’.

The situation emerged at a public hearing organised by the National Electric Power Regulatory Authority (Nepra) on the government request for Rs5.40 per unit additional quarterly tariff adjustment (QTA) to consumers for April-June 2023 when the Power Division made a departure from its petitions. It requested that consumers be charged at a rate of Rs3.55 per unit for six months, instead of Rs5.40 per unit for three months, to reduce the price shock on consumers still struggling to absorb 26pc increase in base national rates notified last month.

Also, the Power Division proposed that even the Rs3.55 per unit additional charge should be imposed after September when an existing quarterly adjustment of Rs1.24 per unit would lapse, thereby further reducing the cost increase. The net increase in tariff for six months — October 2023 to March 2024 — would thus stand at Rs2.31 per unit, a Power Division official pleaded before the regulator.


Additional reporting by Umar Bacha, Hasaan Ali Khan and Muzhira Amin

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