The federal government is set to negotiate with private Independent Power Producers (IPPs), state-owned power plants, and solar and hydropower projects to reduce electricity tariffs by up to Rs. 12 per unit by March 2025.
According to sources, negotiations aimed at lowering electricity costs are ongoing and are expected to be completed within the next six months. Talks involve all major power producers, including IPPs and state-run plants. If successful, the tariff reduction is estimated to range between Rs. 7 to Rs. 12 per unit. The deadline for completing the negotiations is set for March 2025.
Efforts are also underway to reprofile loans tied to China-Pakistan Economic Corridor (CPEC) projects and government-owned power plants. Officials from the Ministry of Energy confirmed that agreements with five IPPs, including Hub Power, Rousch Power, AES Lalpir, Saba Power, and Atlas Power, have already been terminated, bringing the total to six canceled agreements so far.
These terminations alone could lead to an immediate reduction of Rs. 3 per unit in tariffs. Additional savings of Rs. 4 per unit could be achieved through loan restructuring. Off-peak tariffs are projected to decrease from Rs. 41.68 to Rs. 29.68 per unit, while peak-hour tariffs could drop to Rs. 36 per unit.
The Ministry of Energy’s task force is also negotiating with 18 IPPs, 15 of which have already signed revised contracts. Additionally, discussions are ongoing with operators of nuclear power plants, hydropower projects, coal-based plants, and RLNG-based power facilities to secure further reductions in electricity costs.
This initiative underscores the government’s commitment to alleviating the financial burden on consumers while ensuring sustainable energy reforms.
