• Relief to be tied to income rather than power consumption, energy minister tells Senate
• Awais Leghari claims ‘rich and poor alike’ utilising discount meant for protected users, thanks to solar power
ISLAMABAD: The government has decided to scrap the much-criticised electricity slab system that penalises consumers for crossing the 200-unit threshold by even one unit, and introduce targeted subsidies for the poor.
Minister for Energy (Power Division) Sardar Awais Ahmad Khan Leghari told the Senate on Tuesday that work was being expedited to abolish the system under which consumers crossing 200 units have to pay a much higher rate and remain ineligible for relief for the next six months. He was responding to a calling-attention notice moved by Senator Abid Sher Ali regarding tariffs charged by distribution companies and the financial burden on consumers.
Sher Ali said that when monthly consumption increased from 200 to 201 units, the tariff jumped from Rs15 to Rs30 per unit, forcing a poor consumer to pay bills under the 400-unit slab for just one extra unit. The harsh slab system effectively punished the poor and drained the common man’s finances for months, he said.
Acknowledging that this was a genuine problem, Leghari said the ministry was seriously working to abolish the six-month bar. Under the current mechanism, consumers using up to 200 units per month fall into the “protected” category and receive 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 barred from receiving the benefit for six months.
Leghari said the government was considering two options: raising the threshold from 200 to 250 units and allowing consumers to qualify for the protected category in any month in which they restrict consumption to 200 units, thereby abolishing the six-month penalty. “It will take one and a half months to finalise the plan,” he said.
More importantly, he said, the government was working on a new system to provide relief based on poverty and income rather than consumption. He pointed out that the number of protected consumers had increased from 10 million to 20–25 million over the past two years due to the adoption of solar energy.
Many of them were not poor. Even consumers using 700 to 800 units were limiting their grid consumption to 200 units by installing solar panels and claiming relief intended for lower-income households.
“It would not be appropriate to offer equal discounts to everyone using less than 200 units,” he said, adding that the government was providing a 65 per cent subsidy to protected consumers, a benefit being claimed by rich and poor alike, which was unfair. The new mechanism would restrict subsidies to those living below the poverty line and lower-middle-income groups, he said.
Turning to the power sector’s financial situation, Leghari said circular debt had declined to Rs1.6–1.67 trillion and was no longer increasing every year. The government had set a target to eliminate it within the next four years under its debt-reprofiling scheme. The debt servicing surcharge of Rs3.23 per unit would also be abolished during the same period.
He said that when Prime Minister Shehbaz Sharif took over in 2024, annual losses of distribution companies, including theft and non-recovery, stood at Rs591 billion. The losses had fallen from Rs360bn last year to Rs325bn this year due to efforts to improve efficiency.
He maintained that the Power Division had received Rs1,180bn in budgetary support from the Finance Ministry in 2024, a figure expected to fall to Rs700-Rs750bn this year, reducing the burden on the annual budget by about Rs200bn.
However, he acknowledged that, since consumers did not bear the companies’ losses and the Finance Ministry covered the cost, the benefits 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.
Published in Dawn, October 28th, 2026
