ISLAMABAD: The federal government is exploring a proposal to rebase electricity tariffs annually from January 1 instead of July, aiming to mitigate public discontent during peak summer months when fuel charges adjustments (FCAs) and quarterly tariff adjustments (QTAs) amplify electricity costs.
The proposal, advanced by the Power Division, seeks to streamline tariff adjustments during winter when electricity consumption is lower, ensuring a more stable and sustainable pricing mechanism throughout the year. The Economic Coordination Committee (ECC) of the Cabinet is expected to deliberate on the matter in an upcoming meeting.
The National Electric Power Regulatory Authority (NEPRA), however, has highlighted regulatory challenges, including the ongoing timeline for tariff rebasing set to take effect from July 2025. NEPRA emphasized that aligning the tariff cycle with the proposed January timeframe would require substantial amendments to legal and procedural guidelines, which typically span nine months for approval.
To address NEPRA’s concerns, the Power Division proposed a transition period, recommending the January rebasing schedule begin in 2026. NEPRA also flagged the need to adjust the timelines for DISCOs’ investment plans and Power Purchase Price (PPP) projections, currently structured around the July-to-June accounting year.
The Power Division reassured NEPRA, clarifying that the proposal targets the tariff control period without altering the DISCOs’ accounting year. The Division further suggested interim tariffs and prior-year adjustments to bridge the transition.
The government anticipates that shifting the annual tariff rebasing to winter will alleviate the financial strain on consumers during summer months and foster public acceptance of electricity pricing reforms.
