ISLAMABAD: Power Minister Awais Leghari told the Senate on Tuesday that the government has decided to scrap the electricity slab system that punishes consumers for crossing the 200-unit threshold even by one unit, and to provide targeted subsidy only to those deserving.

Under the current mechanism, consumers using up to 200 units per month fall under the “protected” category and avail a subsidy of around Rs13 per unit. However, any consumer exceeding the limit by even one unit has to pay up to Rs33 per unit and is then not allowed to avail the facility for six months.

Speaking in the Upper House, Leghari said work was being expedited to abolish the system under which a consumer crossing 200 units has to pay a much higher cost per unit and remains ineligible for relief for the next six months.

The minister was responding to a calling-attention notice moved by PML-N Senator Abid Sher Ali regarding tariffs charged by distribution companies (Discos)and the financial burden on consumers.

Ali highlighted that when monthly consumption increased from 200 to 201 units, the tariff jumped from Rs15 to Rs30 per unit, forcing a consumer to pay bills under the 400-unit slab for just one extra unit.

“The cruel slab system effectively punished the poor and drained the common man for months,” he said.

Acknowledging it as a genuine problem, Leghari said the ministry was seriously working to abolish the six-month bar.

He said the government was considering two options: raising the threshold from 200 to 250 units; or abolishing the six-month penalty by allowing consumers to get the protected category benefit for the month in which they restrict consumption to 200 units.

“It will take one and a half months to finalise the plan,” the power minister outlined, adding that the government was working on a new system to provide relief based on income rather than consumption.

He pointed out that the number of protected consumers had increased from 10 million to 20-25m during the last two years due to the use of solar energy. Many of them, including consumers using 700 to 800 units, were limiting grid consumption to 200 units by installing solar panels and availing relief meant for lower-income households.

“It would not be appropriate to offer equal discount to everyone using less than 200 units,” Leghari said, adding that the government was providing a 65 per cent subsidy to protected consumers which was being availed by rich and poor alike.

The new mechanism would restrict subsidy to those living below the poverty line and lower-middle income groups, he explained.

Turning to the power sector’s financial situation, Leghari said circular debt had declined to around Rs1.67 trillion and was no longer increasing every year.

The government had set a target to eliminate it within the next four years under the reprofiling of the financing scheme, and the debt servicing surcharge of Rs3.23 per unit would also be abolished during the same period, the minister added.

Leghari recalled that when Prime Minister Shehbaz Sharif took office in 2024, the annual losses of Discos, including theft and non-recovery, were Rs591bn. The losses had come down from Rs360bn last year to Rs325bn this year due to efforts to improve efficiency.

He maintained that the Power Division was getting Rs1.18tr in budgetary support from the finance ministry in 2024, which was expected to come down to between Rs700bn-750bn this year, reducing the burden on the annual budget by about Rs200bn.

However, Leghari acknowledged that since consumers did not bear the losses of companies, and it was the finance ministry that bore the burden, the benefit of reduced losses had not yet been passed on to consumers.

He said preventing electricity theft remained the government’s top priority, but consumers would not be burdened arbitrarily.

Govt to implement national AI ecosystem

The Senate was also informed today that the government is implementing a national artificial intelligence (AI) ecosystem, encompassing AI infrastructure, human capital, research, startups, financing and responsible AI governance.

Minister for Parliamentary Affairs Tariq Fazal Chaudhry told the House during Question Hour that the National Artificial Intelligence Ecosystem Development Programme — approved earlier this year — was one of the government’s most significant upcoming interventions for AI development.

He added that the government had announced a $1bn investment for Pakistan’s AI Ecosystem by 2030, and was also implementing the National AI Advancement Initiative to accelerate AI adoption and build practical AI capacity.

Responding to a supplementary question, Deputy Prime Minister and Foreign Minister Ishaq Dar informed the House that the first council meeting of the World AI Cooperation Organisation is expected in mid-December.

The organisation is a China-led initiative aimed at promoting transparency, openness and cooperation in artificial intelligence. Pakistan had joined the body in July as a founding member.

Dar said around 50 members had joined the organisation, which would be headquartered in Shanghai.