ISLAMABAD: The government on Sunday notified a 50 per cent increase in fixed gas charges for all consumer categories and raised per unit gas sale rates by up to 17pc for industrial, power and bulk users, effective from July 1.

The revision is expected to place an additional financial burden of around Rs85 billion on consumers during the 2025-26 fiscal year, as part of efforts to meet a structural benchmark set by the International Monetary Fund (IMF).

The Oil and Gas Regulatory Authority (Ogra) issued the notification on the federal government’s directives.

The move is expected to generate about Rs31bn in surplus revenue for the Sui Southern Gas Company Ltd (SSGCL) and bridge an estimated Rs41bn shortfall for the Sui Northern Gas Pipelines Ltd (SNGPL). It will also yield around Rs13bn in additional general sales tax revenue for the government.

According to the notification, fixed monthly charges for protected domestic consumers — those using between 25 and 90 cubic metres per month — have been increased by 50pc, from Rs400 to Rs600. Their per unit gas rates remain unchanged, but the minimum monthly bill will now exceed Rs755, up from Rs519, even if they do not consume a single unit of gas.

Rates for industrial, power sector rise by 17pc

The consumers in this category include those whose average consumption of the last four winter months (November to February) remains below 90 cubic meters.

Likewise, the fixed charges for non-protected domestic consumers — using 25 to 100 cubic metres per month — have been increased to Rs1,500 from Rs1,000, a 50pc rise. The minimum bill for this group will cross Rs1,820 per month from Rs1,230.

Similarly, fixed charges for domestic consumers using more than 150 cubic metres per month have been jacked up to Rs3,000 from Rs2,000. Their minimum bill without any consumption will cross Rs3,590 per month from Rs2,407.

All the above categories will be provided with the benefit of only one previous slab. However, households using more than 400 cubic metres per month will be subjected to a flat rate of Rs4,200 per unit for their entire consumption.

Meanwhile, industrial and bulk consumers and power plants will face an average increase of 10pc in per unit gas prices. Rates for the power sector have been raised by about 17pc, from Rs1,050 to Rs1,225 per unit (million British thermal units, or mmBtu), which is expected to result in a 10-paisa per unit increase in average electricity tariffs.

The gas rates for bulk consumers have been increased by 9.5pc to Rs3,175 from Rs2,900 per mmBtu at present, instead of a 6pc hike proposed by the petroleum division. Likewise, a 7pc increase has been notified for industrial (process) consumers to Rs2,300 from Rs2,150 per mmBtu at present.

The fixed charges and per unit gas rates for all other categories, including special commercial (tandoors), commercial, ice and cement factories, industrial captive power plants and fertiliser plants, have been kept unchanged.

The IMF directed the authorities last month to ensure timely tariff adjustments in line with revenue requirements, as part of efforts to manage circular debt in the gas sector and shift captive power plants (CPPs) to the national electricity grid. A new structural benchmark requires the next tariff adjustments on July 1, 2025, and Feb 15, 2026.

As a consequence, the authorities made a commitment to “continue to notify semi-annual gas tariff adjustments as determined by Ogra (on July 1, 2025, and Feb 15, 2026). Gas tariff adjustments will continue to include the cost of imported RLNG”, the finance minister had committed in writing to the IMF.

The government has also committed to improving the monitoring and management of the gas circular debt.

The consumer-end gas price notification issued by Ogra would ensure revenue requirement of Rs888.6bn — Rs534.458bn to the SNGPL and Rs354.2bn for SSGCL as determined by Ogra for the fiscal year 2025-26.

Published in Dawn, June 30th, 2025