Breaking News: Industrial Electricity Tariff Pakistan 2025 Sparks Controversy – Industries Demand 9 Cents Rate
The announcement of the new industrial electricity tariff Pakistan 2025 has triggered strong reactions across the country’s business community. While the government has introduced a so-called “cheaper power plan” to boost industrial consumption, industrialists and trade bodies are calling it “discriminatory” and “too complex to succeed.” They are demanding a fixed power rate of 9 cents per unit to revive exports, competitiveness, and industrial growth.
Officials from the National Electric Power Regulatory Authority (Nepra) and the Power Division argue that the scheme is designed to encourage higher consumption and reduce the massive burden of capacity charges on the national grid. However, business leaders, particularly from the textile and manufacturing sectors, have rejected the plan, warning that high tariffs and confusing policies are suffocating Pakistan’s industrial engine.
⚙️ Government’s Plan: Cheaper Electricity to Boost Production
Under the incremental consumption package, the government aims to supply electricity at Rs. 22.98 per unit to industrial and private agricultural consumers. This includes both time-of-use (ToU) and non-ToU categories across ex-Wapda distribution companies (DISCOs) and K-Electric.
The plan is set to cover a reference period from December 2023 to November 2024 and will remain in force for three years after approval. Officials from the Power Division claim that this package is “subsidy neutral,” meaning it will not place an extra financial burden on either DISCOs or K-Electric consumers.
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| Feature | Details of Incremental Consumption Package 2025 |
|---|---|
| Power Rate | Rs. 22.98 per unit |
| Duration | 3 years (from approval date) |
| Reference Period | Dec 2023 – Nov 2024 |
| Target Consumers | Industrial & Agricultural |
| Subsidy Impact | Neutral for all DISCOs and K-Electric |
| Objective | Increase power consumption & stabilize grid |
Officials believe that the industrial electricity tariff Pakistan 2025 will contribute Rs. 1.16 trillion to the national GDP and help absorb idle capacity charges worth Rs. 1.7 trillion — being paid to power plants that produce zero electricity.
⚡ Industrial Sector’s Rejection: “This Plan Won’t Work”
Despite government optimism, the business community has dismissed the proposal. Industrialists say the tariff is too high and the eligibility criteria are overly complicated. Many have compared it with earlier successful plans where a flat 9 cents per unit rate was offered.
Representatives from All Pakistan Textile Mills Association (APTMA) and the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) said the current proposal is impractical and will not lead to higher consumption.
Rehan Jawed of FPCCI criticized the one-year reference period, suggesting it should be extended to three years. He added that the cross-subsidy burden on industries must be reduced, otherwise production costs will remain uncompetitive.
Similarly, Amir Sheikh, another industry leader, stated that “the previous package worked only because the government fixed the tariff at 9 cents per unit.” He called the new policy “discriminatory,” saying that it benefits some sectors while ignoring others.
🌐 Nepra’s Concerns and Industry Feedback
The Nepra hearing, held to review the package, revealed growing concern over its complexity and lack of consultation. Nepra officials questioned whether stakeholders had been taken on board before designing the scheme.
They also highlighted that the uncertainty over tariff adjustments could discourage industries from planning long-term investments. According to a Nepra technical member, “Industries will remain confused if tariff revisions continue every few months.”
Power Division officials, however, maintained that a review clause was necessary. They said if marginal costs rise, the government would approach Nepra again for adjustments to prevent risks to other consumers. Still, they insisted the chances of price increases were “minimal.”
☀️ Solarisation Impact: Power Demand Shifting, Not Falling
Another major topic during the Nepra session was solarisation — the shift of consumers to solar energy. Officials disclosed that over 6,000 megawatts of net-metered solar connections have been installed nationwide, while 12,000–13,000 MW worth of consumers have gone completely off-grid.
Interestingly, they noted that total demand hasn’t dropped, but rather shifted from day to night hours. With daytime solar generation, peak grid load now extends from 10 p.m. to early morning. The new tariff plan, they claimed, is intended to stabilize the grid and prevent further collapse of base-load plants.
In the agriculture sector, however, demand has dropped by 40–50% as farmers increasingly adopt solar tube wells. Officials say the package aims to balance this transition by rewarding incremental power use and discouraging total off-grid migration.
🏭 Business Leaders Call for Simpler Tariff
Industrial representatives across sectors stressed the need for predictable pricing and simplified rules.
Syed Absar Ali, from APTMA, remarked that “no one can increase consumption by more than 15%” under current conditions. He urged the government to reduce the load factor from 60% to 40%, particularly for export-oriented textile units.
| Industry Demand | Requested Change |
|---|---|
| Tariff | Fix at 9 cents per unit |
| Load Factor | Reduce from 60% to 40% |
| Eligibility | Simplify criteria |
| Reference Period | Extend from 1 to 3 years |
| Cross-Subsidy | Remove burden on industries |
| Grid Return Policy | Allow captive & wheeling consumers to rejoin grid |
Many industrialists also expressed disappointment that captive power consumers (those with private power setups) and wheeling consumers were excluded. They demanded a new, inclusive policy that offers equal benefits to all.
💬 Expert Analysis – Why the 9-Cent Rate Matters
Economists and power analysts believe the 9-cent rate has symbolic and practical importance. It represents a competitive global benchmark for industrial power tariffs in developing economies.
In contrast, Pakistan’s effective cost — even after the discount — remains above 13–15 cents per unit when taxes and surcharges are added. Experts argue that without a globally competitive power rate, exports will continue to shrink and local manufacturing will fail to scale up.
They also warn that over-reliance on capacity payments and non-performing power plants has made the entire system unsustainable. Unless the industrial base expands rapidly, Pakistan will remain locked in a cycle of paying for unused electricity.
⚖️ Government’s Defense – “It’s a Win-Win for All”
Officials at the Power Division defended the industrial electricity tariff Pakistan 2025 by saying that the incremental consumption model is a “win-win” for both consumers and the grid.
They believe the plan encourages industries to run multiple shifts, improve utilization, and reduce the overall burden of capacity charges — which are currently Rs. 1.7 trillion annually.
“The demand didn’t fall because of lower production,” one official said. “It’s just that consumption has moved from daytime to nighttime due to solar power. This package will stabilize demand and strengthen grid reliability.”
However, they also hinted that if the marginal cost rises unexpectedly, the policy could be revised or withdrawn, keeping industries cautious.
📊 Economic Stakes of Industrial Electricity Tariff Pakistan 2025
The stakes are high for Pakistan’s economy. The industrial sector contributes over 20% to GDP and employs millions. Any instability in power tariffs directly affects production costs, exports, and foreign exchange earnings.
Analysts say that if the 9-cent tariff is implemented, it could lead to a resurgence in textile and manufacturing output, reduce idle capacity payments, and stabilize electricity demand patterns across the national grid.
But for now, the disconnect between policymakers and industrialists continues — threatening to delay much-needed economic recovery.
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❓ Frequently Asked Questions (FAQs) about Industrial Electricity Tariff Pakistan 2025 :
Q1: What is the industrial electricity tariff Pakistan 2025?
It is a new government plan offering electricity to industrial and agricultural users at Rs. 22.98 per unit under an incremental consumption scheme valid for three years.
Q2: Why are industries rejecting the new power plan?
Because they consider it too complicated and costly. Industrialists are demanding a fixed rate of 9 cents per unit to ensure competitiveness.
Q3: How long will the new power package remain in force?
It will remain effective for three years from the date of approval by Nepra.
Q4: What is the main concern of Nepra regarding the package?
Nepra is concerned about tariff uncertainty, stakeholder exclusion, and lack of clarity on future price adjustments.
Q5: How much capacity payment burden does Pakistan face?
Consumers are paying around Rs. 1.7 trillion annually to power plants that are not generating electricity.
Q6: How has solarisation affected Pakistan’s power demand?
Solarisation has shifted demand from daytime to nighttime, with around 13,000 MW of consumers now off-grid.
Q7: What are the industries’ key demands?
Fix tariff at 9 cents, simplify eligibility, reduce load factor, and remove cross-subsidies.
Q8: What could be the economic impact of the 9-cent rate?
A lower fixed tariff could revive exports, attract investment, and boost GDP growth.
🏁 Conclusion – The Future of Pakistan’s Industrial Power Policy
The debate over the industrial electricity tariff Pakistan 2025 highlights Pakistan’s broader energy dilemma — balancing affordability, sustainability, and grid stability. While the government insists its plan is based on “lessons from the past,” industrialists remain unconvinced, warning that high costs and complex rules will only push more businesses off-grid.
Unless policymakers and industries align on a transparent, globally competitive rate, Pakistan’s power sector reforms may fail to deliver. For now, the industrial sector’s message is clear: only a 9-cent tariff can spark true industrial revival.
