The government plans to impose an extra charge of Rs1.52 per unit on electricity consumers of K-Electric, aiming to collect around Rs25 billion in additional revenue this year. This surcharge will be in addition to the existing average Rs30 per unit national base tariff, Rs3.23 per unit financing cost surcharge, and various taxes and duties that change every quarter and month.
Power Shock: KE Consumers Face Rs1.52 Surcharge
The National Electric Power Regulatory Authority (Nepra) will hold a public hearing on August 15 to finalize this decision. This new surcharge will apply to all consumers, regardless of their consumption limit or category.
The reason behind this surcharge is the 15-month period between July 2019 and September 2020 when K-Electric obtained stay orders against the Multi-Year Tariff (MYT) approved by the regulator in July 2018. As a result, consumers of other distribution companies paid higher rates approved by the regulator, while K-Electric consumers did not experience a similar increase during that time.
It’s worth noting that even new consumers who weren’t in Karachi three years ago would have to bear the burden of this surcharge alongside those who may have moved out of the city. This was a concern raised in an ECC meeting, but the government decided to meet subsidy targets set by the International Monetary Fund (IMF).
The Power Division justified the surcharge by citing the Nepra Act, which allows the government to charge and notify surcharges on electric power consumers for funding public sector projects and fulfilling financial obligations of the federal government for electric power services.
The government also has the authority, under the National Electricity Policy 2021, to maintain a uniform consumer-end tariff for both K-Electric and state-owned distribution companies, even after privatization, through direct or indirect subsidies.
