NEPRA Imposes Fixed Monthly Charges on Households

In a significant tariff rationalisation measure, the National Electric Power Regulatory Authority (NEPRA) has approved the imposition of fixed monthly electricity charges ranging from Rs200 to Rs675 for domestic consumers. The policy shift is anticipated to increase billing burdens for low-consumption households while strengthening revenue certainty for distribution companies.

NEPRA has authorised a comprehensive restructuring of tariff structures applicable to former WAPDA distribution companies (DISCOs) and K-Electric. The revised framework introduces mandatory fixed monthly charges across residential categories, payable irrespective of actual electricity consumption, thereby altering the traditional billing methodology.

Industry estimates indicate that the revised fixed charges will apply to approximately 28.5 million residential consumers and are projected to generate nearly Rs101 billion in additional revenue recovery.

Under the new tariff regime, most domestic consumers will be subject to fixed monthly charges. The maximum charge of Rs675 will apply to households consuming more than 600 units per month. Protected domestic consumers will be liable for fixed charges of Rs200 or Rs300, while non-protected consumers will face charges ranging from Rs275 to Rs675, depending on consumption slabs.

Specifically, protected consumers consuming up to 100 units per month will pay Rs200, whereas those consuming up to 200 units will pay Rs300. Lifeline consumers remain exempt from any fixed monthly charge.

For non-protected consumers, fixed charges commence at Rs275 for usage up to 100 units and increase to Rs400 for up to 200 units. Consumption between 201–300 units will attract Rs550, 301–400 units Rs600, 401–500 units Rs650, and usage exceeding 600 units Rs675 per month.

This reform marks a departure from the conventional consumption-based billing model, where cost recovery was predominantly tied to per-unit electricity usage. Under the revised structure, distribution entities will secure a portion of fixed operational revenues irrespective of fluctuations in consumption levels, including reductions resulting from energy conservation measures or rooftop solar installations.

Energy policy analysts caution that the new mechanism may have a disproportionate impact on low-usage households, as consumers will incur a mandatory base charge regardless of minimal grid consumption. Smaller households and those partially shifting to alternative energy sources may experience reduced flexibility in lowering monthly bills.

Regulatory authorities contend that the decision addresses structural imbalances arising from escalating fixed system costs and declining electricity sales volumes. Obligations such as capacity payments, transmission and distribution infrastructure maintenance, and grid management require predictable funding streams, which the revised framework seeks to secure.

Observers note that the introduction of fixed cost recovery may influence consumer behaviour, as reductions in consumption will no longer translate into proportional bill reductions. The policy represents a fundamental restructuring of electricity tariff design, embedding fixed charges as a permanent element of domestic billing.