Islamabad:
Prime Minister Shehbaz Sharif announced on Thursday to reduce electricity prices by 15% or RS7.41 per year. Unit due to seasonal customs adjustments and by increasing budget-neutral grants to increase consumption from National Grid and provide comfort to financially fighting families
The advantage has been given to approx. 40.3 million consumers, mainly 35 million housing users.
The Prime Minister announced the new electricity rates in the Prime Minister’s office at a ceremony attending people from all walks of life.
Prices have been reduced due to quarterly duty customization, monthly fuel cost adjustment, resulting from reduction in taxes and also by increasing the oil -financed subsidy, according to government officials.
There is about RS3.40 per Unit reduction due to quarterly customs adjustment, less than RS1 per Monthly reduction of fuel costs and increasing subsidies with RS1.71 per Device, they added. This will reduce the bill by RS6 per Unit, and after adding the impact of the tax on the reduced price, the total effect will be RS7.41 per year. Unit.
Compared to the existing rates, the domestic electricity prices are reduced by RS7.41 per year. Unit, and the new average rate will be RS34.37 per Unit, the prime minister said, adding that the electricity award for the industries has also been reduced by RS7.69 per year. Unit for RS40.51.
The prime minister said his government had to face “greater difficulties” in convincing the International Monetary Fund to reduce electricity prices, despite not being willing to allow even the budget neutral cut in prices.
“The IMF does not allow us to reduce prices by increasing the petroleum tax rate, and then I had to tell them I would talk to the CEO of the IMF for permission as there was no influence on the reduction in the prices of the budget,” the prime minister said.
The maximum relief of RS8.58 per Unit or 12% have been announced for commercial consumers and RS7.69 per year. Unit or 13% for industrial consumers. Households have been relieved of RS6.14 to RS6.71 per year. Unit, a reduction of 17% to 32%.
The Prime Minister gave credit for the reduction to the Minister of Power Sardar Awasi Leghari, privatization adviser Muhammad Ali and PM’s Taskforce for the Electric Sector’s national coordinator LT -General Zafar, who performed the hard task of ‘convincing’ the owners of the power plants to renovate their agreements.
According to new prices, there is no reduction in prices for the lifeline consumers of up to 100 units that have already paid far lower than the cost of production of electricity. Prices for protected housing consumers who have up to 100 units consumption have been reduced by RS6.14 per year. Unit or 32% to RS8.52 per Unit.
Prices for protected consumers with 200 units consumption are reduced by RS6.14 per year. Unit for RS11.51, excluding taxes. Consumers of up to 300 units benefit from RS7.14 per year. Unit but their rate will be RS34.
Housing consumers of more than 300 consumption receive relief of RS7.24 per year. Unit and their new rate will be RS48.46 per Unit.
The average price for the domestic consumer will be RS31.63 with a reduction of RS6.71 or 17%.
This is still a slight relief that has been achieved by ingenious methods, the prime minister said, recognizing the difficulties facing households and industry.
A pensioner was left with empty pockets after paying his electricity bills, and these high bills caused frustration and anger among people, the prime minister admitted. He said the government carried out structural reforms in the electricity sector to ensure further relief to consumers and the overall development of the country. “This reduction will help industrialists produce cheaper and more competitive products.”
The commercial consumers’ revised rate will be RS62.47 per year. Unit with 12% reduction. The industrial consumers’ new rate will be RS40.51 per year. Unit by RS7.69 or 13% Reduction. The agricultural percentage will be RS34.58 after RS7.18 or 17% reduction in prices.
The prime minister also set the agenda for further reforms in the electricity sector, giving a task to his “star team” to start working on eliminating over RS600 billion a year loss due to theft and low recovery of bills.
The Prime Minister said the other two goals for his government were to establish an open market for electricity and either privatizing or provincialization of power distribution companies (discosis) to reduce the burden of line loss and power theft at National Exchequer.
When they valued the Task Force formed to end the power reforms, the prime minister said the strength worked really hard, and through their innovative thoughts they brought various possibilities and managed to convince the IMF to reduce power tariffer.
“We did not transfer the low international oil prices and retained prices to ensure that the government wants to reduce the power tariffs that the IMF in principle agreed,” he added.
The Prime Minister said the government successfully negotiated with the independent power producers (IPPS), which will save RS3.7 trillion over a period of three years to 25 years of the remaining lifetime of these power producers.
The prime minister said RS2.4 trillion circular debt is also being treated, which will be brought to zero over a period of five years.
The Prime Minister said Pakistan was on the verge of default over a year ago and that he had to oversee this credits for the import of oil products and other important things are opened in a timely manner. “We didn’t have the resources to even run the power sectors too,” he added.
The prime minister said that Pakistan’s economy had now been stabilized and moved towards sustainable growth and development.
“The country’s economy needed a surgical operation to get rid of all the issues responsible for the crisis in the economic sector,” he added.
