KARACHI: After the national power regulator drastically reduced K-Electric’s average tariff, the utility’s management has said it is looking at ways to ensure power supply and keep the company running.

However, the tariff cut will not reduce electricity bills for Karachi residents, as end-user prices would remain the same under the government’s uniform national tariff policy.

The National Electric Power Regulatory Authority’s (Nepra) decision from earlier this week had reduced the average tariff from Rs39.97/kWh — set by the regulator in May of this year — to Rs32.37/kWh.

The earlier decision had allowed the power utility to offset its losses and other overheads through a ‘loss recovery allowance’ that would be built into their tariff, starting from 6.75pc in FY24 and gradually declining to 3.5pc by FY30.

Nepra’s move will not impact consumers’ bills, applies to power utility’s recovery loss allowance, other overheads

However, the latest decision — issued on a series of review motions filed by various stakeholders, including the Power Division — has “significantly altered its prior determinations in a manner that… is not sustainable for the company and will have far-reaching consequences for its stakeholders, including consumers”, KE claimed.

While the Power Division hailed the power regulator’s decision on KE’s multi‑year tariff as a landmark move for Karachi residents, the power utility warned the move could have an indirect impact on consumers.

In a cautiously worded statement, KE Chief Executive Officer Moonis Alvi said that the management was making every effort to avoid direct impact on customers. “However, there may be some indirect impacts, which are being mitigated,” he added.

Mr Alvi said that the decision regarding the company’s multi-year tariff (MYT) for FY2024-2030 would also significantly impact the company’s financial position, ultimately affect its operations and performance.

The KE chief said that Nepra had made significant changes and reductions in the utility’s approved multi-year tariff, which was approved in May after more than two years of public hearings, consultations and feedback from all stakeholders.

“This kind of change after more than two years of detailed consultation and analysis is unusual and could impact the company’s investments, planning and long-term sustainability,” he added.

Mr Alvi said KE was closely reviewing the impact of the amended decision to determine how to continue operations effectively and minimise the potential impact on customers.

The company’s board of directors has been fully briefed on the amended decision, and consultations were underway to determine the future course of action, he said.

Published in Dawn, October 24th, 2025