Power tariff hike

Power tariff hike

Government has notified an increase of 11 paisa per unit in power tariff as price adjustment to recover an additional amount of Rs. 14 billion from all categories of consumers who honestly pay their monthly bills. NEPRA had recommended an increase of 15 paisa in the original price of electricity. Last month government notified an increase of 17 paisa per unit under fuel price adjustment for the month of September which will be added in the bills issued in the current month. In other words, consumers will be doubly penalized.

In a public hearing of petitions of Power Distribution Companies for tariff hike, Chairman NEPRA had admitted that electricity tariff in Pakistan is very high. A few days ago Advisor on Finance Dr. Abdul Hafeez Sheikh disclosed that increase in power tariff is being done under IMF conditions. But the bitter fact is that power tariff hike fuels inflation and depresses the productive capacity of the economy. That is why the monetary policy operations have not succeeded in bringing down the rising inflation which has shot up to 12.57 percent in the month of November against 11 percent in the month of October. The failed recipe of increase in electricity price adjustment coupled with fuel price adjustment needs to put to rest and focus should be on the recovery of power sector receivables from permanent defaulters.

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