Electricity Consumers Face Possible Rs36.54bn September Burden

Electricity consumers across Pakistan could see an additional burden of Rs36.54 billion in their September bills after the National Electric Power Regulatory Authority (NEPRA) reserved its decision on a proposed fuel cost adjustment of Rs2.518 per unit for July 2026.

The adjustment was requested by the Central Power Purchasing Agency-Guaranteed (CPPA-G) on behalf of electricity distribution companies. The proposed increase has been linked to substantially higher electricity generation costs, particularly due to greater reliance on expensive imported fuels.

CPPA-G told NEPRA that the actual fuel cost of electricity generation increased to Rs9.6112 per unit during July, compared with the reference cost of Rs7.0929 per unit. The agency has sought permission to recover the Rs2.518 per-unit difference from consumers through the monthly fuel cost adjustment mechanism.

If NEPRA approves the request, the additional charge will be incorporated into electricity bills issued to consumers in September.

The proposed increase represents a significant reversal from July 2025, when consumers received a Rs1.79 per-unit reduction through the monthly fuel cost adjustment mechanism.

During the hearing, the Karachi Chamber of Commerce and Industry (KCCI) opposed the proposed hike and urged authorities to consider using domestically available furnace oil instead of costly imported LNG wherever technically and economically possible. The chamber also called for the withdrawal of the levy currently imposed on furnace oil.

KCCI warned that electricity users could potentially face a combined increase of approximately Rs6 per unit from September 1 once different tariff adjustments are taken into account.

Alongside the proposed Rs2.518 per-unit monthly fuel adjustment, an additional upward quarterly adjustment of around Rs1.52 per unit for the third quarter of 2026 is expected to be submitted to NEPRA.

At the same time, an existing relief of Rs1.98 per unit provided under the April-June quarterly adjustment is scheduled to expire, meaning consumers could face further increases in their electricity bills.

The business community warned that the combined effect could significantly raise electricity expenses for both households and commercial users. KCCI also alleged that the government had lowered the reference tariff in an effort to reduce its own subsidy requirements, effectively transferring an estimated Rs250 billion in costs to consumers.

NEPRA has reserved its decision and will issue a separate detailed determination regarding the proposed July fuel cost adjustment.