NEPRA Sanctions Rs1.71/Unit Electricity Tariff Reduction for April-June 2025

ISLAMABAD: On Thursday, the National Electric Power Regulatory Authority (NEPRA) granted approval to the Federal Government’s initiative to reduce electricity tariffs by Rs1.71 per unit for consumers served by Distribution Companies (DISCOs) and K-Electric during the April to June 2025 period.

This measure seeks to alleviate the financial pressures borne by consumers and will be supported by an additional Rs58.6 billion, secured through an enhancement of the Petroleum Development Levy (PDL).

NEPRA has affirmed that this adjustment will not interfere with its previously established tariffs. The relief aligns with the Federal Government’s broader objective to ensure consistent electricity pricing nationwide whilst narrowing the disparity between the national average tariff and the subsidised rate. The authority expressed no reservations regarding the proposal submitted by the Ministry of Energy, noting that the supplementary PDL revenue would finance the subsidy.

The proposal, lodged by the Ministry of Energy (Power Division) on 27 March 2025, advocated an increase in the Tariff Differential Subsidy (TDS). The national average tariff for FY2024–25, as determined by NEPRA, stands at Rs35.50 per kWh, yet the government had authorised a reduced rate of Rs32.99 per kWh, bolstered by TDS. This new Rs1.71 per kWh relief further diminishes costs for all consumer categories, save for lifeline users.

Under the revised framework, specific tariffs, such as the B-4 industrial category, will also benefit from reductions. The peak rate for B-4 will decline from Rs40.76 to Rs34.78 per kWh, whilst the off-peak rate will fall from Rs36.38 to Rs30.40 per kWh.

A public consultation convened by NEPRA on 4 April 2025 allowed stakeholders to raise concerns. Prominent issues included the escalating Rs2.4 trillion circular debt and the growing prevalence of net metering connections. Participants further urged the elimination of the financing cost surcharge and a reassessment of fixed charges.

The Ministry of Energy clarified that the additional Rs1.71 per kWh TDS would apply universally, excluding lifeline users, with the intent to mitigate financial strain and stimulate energy consumption in the forthcoming quarter.

The Federal Government must formalise this decision in the official Gazette within 30 days. Should it fail to comply, NEPRA has indicated it will intervene to enforce the notification.