ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Tuesday criticised the Power Division for attempting to fast-track approval of its proposed cheaper power package for industrial and private agricultural consumers without prior consultation.

“You are compromising your case by seeking instant regulatory approval. This is unfair to the regulator and those who make payments,” said Nepra’s Sindh Member (Technical), Rafique A Shaikh. His remarks followed a request by a Power Division team, led by Additional Secretary Mehfooz Bhatti, for immediate approval so new rates could be reflected in this month’s bills.

Nepra Chairman Waseem Mukhtar presided over the public hearing on the government’s initiative to offer incremental consumption at Rs22.98 per unit, against a base rate of about Rs11 per unit, aiming to revive electricity demand, boost industrial growth, and reduce blackout risks without fiscal outlays.

Industrialists reject package

Representatives from the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and All Pakistan Textile Mills Association (Aptma) criticised the package as inadequate, saying discounts of Rs2-6 per unit on additional consumption were insufficient. They called for the base tariff to drop to 9 cents per unit and for cross-subsidies to be removed, noting that competitors such as Bangladesh, Vietnam, and India offer rates between 4 and 9 cents per unit.

Officials responded that the scheme had been cleared by the federal cabinet and the ministries following a lengthy consultative process. “The industry is free to take it or leave it. The package is not subject to change,” they said.

Regulator says rushing approval undermines process as industrialists call package insufficient

The ministry said solar penetration had grown to 6,035MW in the net-metering segment and 12,000MW in the off-grid segment, creating stability challenges. The incentive package, it said, would help stabilise the grid. When asked about conflicting federal and provincial solar policies, Mr Bhatti avoided a direct response, noting only that the centre supports Punjab’s solar tubewells. Some industrial representatives warned that the scheme might be ineffective due to rising quarterly and monthly tariffs, which have already increased industrial rates from Rs34 to Rs38 per unit.

Expected uptick in demand

The Power Division noted that electricity demand has contracted by 14pc in the industrial sector and 47pc in the agricultural sector, due to macroeconomic adjustments and the adoption of alternative supply. Previous schemes, including the Industrial Support Package (2020-23) and Bijli Sahulat Package (Dec 2024-Feb 2025), had increased industrial consumption by 7-14pc over consecutive months, demonstrating the effectiveness of targeted incentives.

The three-year package applies to industrial and private agricultural consumers of Discos and K-Electric, covering both peak and off-peak incremental usage. Positive Fuel Cost Adjustments (FCAs) will apply to eligible consumers, while Quarterly Tariff Adjustments, Debt Service Surcharge, and negative FCAs will not affect incremental consumption.

If aggregate incremental consumption exceeds 25pc above baseline, a review of rates will be triggered, with semi-annual evaluations to ensure cost-revenue alignment. The scheme will be terminated immediately if upward tariff adjustments are needed for two consecutive reviews. Losses arising from shortfalls between revenues and tariffs will be considered during these reviews.

Benchmark consumption rules will apply to new consumers and Captive Power Plants. Only industrial and private agricultural categories are eligible.

The ministry said the package is expected to encourage industrial and agricultural consumption, improve asset utilisation, and help stabilise the grid, all while remaining fiscally neutral.

Published in Dawn, November 12th, 2025