ISLAMABAD, Jan 30: The subsidy to Wapda consumers with monthly consumption exceeding 1,000 units has been abolished and they are required to pay arrears in lump sum with retrospective effect from August 2001.
This would increase the electricity bills of this category comprising around a million consumers by an average 50 per cent applicable since Aug 8, 2001, and payable during the current month.
In simple terms, the power bill of a consumer paying Rs5,200 would jump to Rs7,820 - an increase of Rs2,620 per month. In addition, they have to pay during the current month a minimum of Rs6,000 price differential as they were being charged by Wapda at old rates.
This would be followed by withdrawal of subsidy to consumers using up to 700 units in the next round, then up to 300 units and finally there would be no subsidy to any consumer by next year. Lifeline consumers with 50-unit monthly consumption would be the only exemption.
Under a directive of the National Electric Power Regulatory Authority, consumers touching the 1000-unit monthly consumption level have been categorised as ‘rich consumers’.
Normally, an air-conditioner running eight hours daily can easily push a consumer into 1,000 unit bracket. They are now charged at a flat rate of Rs6.711 per unit instead of enjoying the benefit of lower slabs of Rs2.14 for first 100 units, Rs3.03 for next 200 units, and Rs5.32 per unit for next 700 units.
When contacted a senior Wapda official told Dawn that the utility did not seek flat rate for consumers of higher category. Instead, it had proposed to introduce a 2-part tariff for fixed capacity charges and electricity consumption to provide incentive to consumers of higher consumption.
The official said that around 70,000 to 80,000 consumers fell under the category of those who consume over 1,000 units and were mainly middle-class consumers. The financial impact of this measure is nominal, said the Wapda official.
When asked why the utility was recovering arrears with retrospective effect, he explained that it had challenged this measure along with domestic electricity rates for Fata consumers through a review petition. The petition was rejected by Nepra.
“Then we proposed to the Chief Executive that a neutral committee of the federal government should examine decisions of the Nepra,” he said and added that proposal was rejected and the Chief Executive held that Nepra was the competent authority on all these issues.
He said a lot of time was consumed during this dispute but finally the recovery was to be made with the date of notification under the Nepra decision i.e. Aug 8, 2001.
When contacted a Nepra member told Dawn that under the power sector reforms agreed to with the donor agencies, Nepra is required to phase out all subsidies in the power sector except lifeline consumers.
“In the next round, subsidy will be withdrawn to more consumers and finally to all consumers at a suitable time,” said the member but denied that there was any time schedule or deadline for removal of these subsidies.
A separate petition for increase in power tariff to cover around Rs32 billion Wapda deficit is currently under consideration of the Nepra. The ministry of water and power on behalf of Wapda has refused to implement reduction in tariff determined by Nepra early this month on account of automatic fuel adjustment.
