ISLAMABAD, April 14: The federal government has decided in principle not to increase power tariff by an average 12 paisa per unit for Wapda consumers approved by Nepra and provide an equivalent grant of Rs1.5 billion to Wapda to meet its cash needs.

A senior official of the finance ministry told Dawn that a notification would, however, be issued to implement the determination of Nepra.

This proposition would meet the requirement of a Statutory Regulatory Order (SRO) issued under Nepra Act to quarterly review the fuel-based automatic tariff that was put in place under an agreement with the World Bank and the IMF.

This means that the increase in tariff would be represented in Wapda bills but not charged from consumers by substracting the same amount from the bill against the government subsidy on the pattern of GST collection from residential consumers.

A formal announcement to this effect would made when Finance Minister Shaukat Aziz returns from Washington after meeting the WB and IMF officials, the official said.

Nepra sources said that officials of the finance ministry had approached Nepra as to what could be a way out as the prime minister did not want to increase tariff.