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The federal government on Wednesday approved an increase in the power tariff by up to 17% and also jacked up the gas rates by nearly 15% to get additional Rs152 billion from the energy consumers.
The per unit increase in power tariff is minimum 32 paisa (2%) for up to 200 units monthly consumers and maximum Rs2.63 per unit (17.2%) for commercial and industrial consumers.
The electricity tariff increased on account of quarterly price adjustments and the consumers will pay additional Rs130 billion, excluding the impact of sales tax.
Similarly, the gas prices have also been approved to increase by Rs50 per mmbtu for all consumers, except domestic and roti tandoor, which fall in the range of 3.9% to 14.8%. The increase would give the government additional revenues of Rs22 billion.
In addition to that, the gas tariffs for Sindh-based exporters have been increased by 18.3% or Rs144 per mmbtu for five months period.
The decisions were taken by the Economic Coordination Committee (ECC) of the Cabinet, which will now be placed before the federal cabinet for its ratification.
The ECC’s nod may also help removing bottlenecks in the revival of the stalled International Monetary Fund programme.
Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh chaired the ECC meeting, which also approved to lay off half of the employees of the Pakistan Steel Mills and sanctioned Rs31.4 billion for golden handshake and clearing outstanding dues.
Power tariffs
“The ECC decided to rationalise the tariff of the power sector-FCA and quarterly adjustments which were due for the period from November 2019 to June 2020,” said an official handout of the Ministry of Finance.
According to the Nepra determination, there could have been a price increase in tariff to the tune of Rs1.62/ kWh but the forum also decided to add subsidy to the price for the end consumers that comes to about Rs1.30/kWh and for the consumers of electricity up to 200 units will only be 32 paisa, the finance ministry said.
However, the official handout did not mention the increase for domestic consumers of over 200 units and commercial and industrial consumers.
The Power Division summary for the ECC showed that the tariff for domestic consumers of over 200 units had been approved to increase by Rs1.62 per unit or 10.6%.
For the commercial and industrial consumers, the rates had been increased by Rs2.63 per unit or 17.2%.
The quarterly adjustments were in addition to increase in electricity rates on account of fuel price adjustments for the period of November 2019 to June 2020.
Gas tariffs
“The ECC approved the increase in natural gas sale price for commercial consumers excluding domestic, tandoor,” the finance ministry said.
The ECC decided that the increase should not be more than one-third of the GIDC, which was imposed till August 2020, it added.
The Petroleum Division had recommended uniform increase of gas sales prices by Rs50 per MMBtu to all consumers excluding domestic and roti tandoor.
The gas tariffs for commercial, cement and CNG consumers have been increased by 3.9%, fertiliser feed old plants 14.8%, fertiliser fuel 4.4%, power plants 6.1%, general industry 4.9% and textile sector 6.3%.
The ECC also approved increase of Rs20 per month as metre rent for domestic consumers for both gas companies, the finance ministry said.
The ECC allowed gas and RLNG supply to industrial sector, based in Sindh.
In order to avoid curtailment of gas to these industries, which are heavily reliant on the commodity, supply of LNG will be made available to the industrial sector to ease up pressure on the SSGC system, the finance ministry noted.
Starting from October 2020, gas supplies would be reduced to 50% for both Saturdays and Sunday to the export sector for two consecutive weekends and possibly the third weekend, in order to build sustainable gas pressures in SSGC’s system.
“The weighted average tariff will be charged at Rs930/MMBTU till February 2021,” the finance ministry said.
The existing rates are nearly Rs786 per mmbtu, according to an official of the APTMA.
In September 2018, the ECC had set the gas tariffs for five Punjab-based export-oriented sectors at $6.5 per MMBTU and they were provided half local gas and half imported LNG to meet their needs.
As of September 2020, the SSGC faced 155 mmcfd gas shortage, which is projected to increase to 250 mmcfd and would remain at that level till February next year.
The Petroleum Division had proposed that the shortfall could be met by providing LNG at full cost.
The export-related consumers in Punjab are still paying about Rs1,080 per mmbtu price.
tribune.com.pk
The per unit increase in power tariff is minimum 32 paisa (2%) for up to 200 units monthly consumers and maximum Rs2.63 per unit (17.2%) for commercial and industrial consumers.
The electricity tariff increased on account of quarterly price adjustments and the consumers will pay additional Rs130 billion, excluding the impact of sales tax.
Similarly, the gas prices have also been approved to increase by Rs50 per mmbtu for all consumers, except domestic and roti tandoor, which fall in the range of 3.9% to 14.8%. The increase would give the government additional revenues of Rs22 billion.
In addition to that, the gas tariffs for Sindh-based exporters have been increased by 18.3% or Rs144 per mmbtu for five months period.
The decisions were taken by the Economic Coordination Committee (ECC) of the Cabinet, which will now be placed before the federal cabinet for its ratification.
The ECC’s nod may also help removing bottlenecks in the revival of the stalled International Monetary Fund programme.
Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh chaired the ECC meeting, which also approved to lay off half of the employees of the Pakistan Steel Mills and sanctioned Rs31.4 billion for golden handshake and clearing outstanding dues.
Power tariffs
“The ECC decided to rationalise the tariff of the power sector-FCA and quarterly adjustments which were due for the period from November 2019 to June 2020,” said an official handout of the Ministry of Finance.
According to the Nepra determination, there could have been a price increase in tariff to the tune of Rs1.62/ kWh but the forum also decided to add subsidy to the price for the end consumers that comes to about Rs1.30/kWh and for the consumers of electricity up to 200 units will only be 32 paisa, the finance ministry said.
However, the official handout did not mention the increase for domestic consumers of over 200 units and commercial and industrial consumers.
The Power Division summary for the ECC showed that the tariff for domestic consumers of over 200 units had been approved to increase by Rs1.62 per unit or 10.6%.
For the commercial and industrial consumers, the rates had been increased by Rs2.63 per unit or 17.2%.
The quarterly adjustments were in addition to increase in electricity rates on account of fuel price adjustments for the period of November 2019 to June 2020.
Gas tariffs
“The ECC approved the increase in natural gas sale price for commercial consumers excluding domestic, tandoor,” the finance ministry said.
The ECC decided that the increase should not be more than one-third of the GIDC, which was imposed till August 2020, it added.
The Petroleum Division had recommended uniform increase of gas sales prices by Rs50 per MMBtu to all consumers excluding domestic and roti tandoor.
The gas tariffs for commercial, cement and CNG consumers have been increased by 3.9%, fertiliser feed old plants 14.8%, fertiliser fuel 4.4%, power plants 6.1%, general industry 4.9% and textile sector 6.3%.
The ECC also approved increase of Rs20 per month as metre rent for domestic consumers for both gas companies, the finance ministry said.
The ECC allowed gas and RLNG supply to industrial sector, based in Sindh.
In order to avoid curtailment of gas to these industries, which are heavily reliant on the commodity, supply of LNG will be made available to the industrial sector to ease up pressure on the SSGC system, the finance ministry noted.
Starting from October 2020, gas supplies would be reduced to 50% for both Saturdays and Sunday to the export sector for two consecutive weekends and possibly the third weekend, in order to build sustainable gas pressures in SSGC’s system.
“The weighted average tariff will be charged at Rs930/MMBTU till February 2021,” the finance ministry said.
The existing rates are nearly Rs786 per mmbtu, according to an official of the APTMA.
In September 2018, the ECC had set the gas tariffs for five Punjab-based export-oriented sectors at $6.5 per MMBTU and they were provided half local gas and half imported LNG to meet their needs.
As of September 2020, the SSGC faced 155 mmcfd gas shortage, which is projected to increase to 250 mmcfd and would remain at that level till February next year.
The Petroleum Division had proposed that the shortfall could be met by providing LNG at full cost.
The export-related consumers in Punjab are still paying about Rs1,080 per mmbtu price.
ECC approves double-digit increase in power, gas tariff | The Express Tribune
Electricity rates up by up to 17%; gas by nearly 15%
tribune.com.pk
