Islamabad: The federal government has expressed optimism about a reduction in electricity prices by Rs10-12 per unit amid ongoing discussions with the International Monetary Fund (IMF) regarding captive power plants.
Federal Minister for Energy Awais Leghari stated during a session of the National Assembly’s Standing Committee on Energy on Thursday that the matter concerning captive power plants is nearing resolution.
The minister revealed plans to review eight bagasse-based power plants and an additional 16 plants. He added that these evaluations would be followed by an assessment of the return on equity for government-owned plants. “By the end of this month, the issue of captive power plants will be resolved,” he mentioned, adding, “Electricity prices for domestic consumers have already been reduced by Rs4 per unit.”
Leghari expressed his goal to lower electricity prices by Rs50 per unit, though he acknowledged the challenges in achieving this target.
Regarding K-Electric, Leghari criticized the power utility’s demand for Rs500 billion in profits over the next 5-7 years, deeming it unreasonable. He emphasized that such a profit margin would unfairly impact consumers in regions like Khyber Pakhtunkhwa.
This statement follows repeated calls from Prime Minister Shehbaz Sharif’s government for a reduction in electricity prices.
Earlier this month, sources revealed that a tariff revision for eight bagasse-based power plants would result in savings of Rs238 billion, equating to Rs8.83 billion annually. Moreover, terminating or modifying contracts with 16 additional IPPs would yield savings of Rs481 billion, which will be passed on to consumers as reduced electricity costs.
Leghari also announced the introduction of a competitive electricity market in March, where market forces will determine power tariffs, with the government’s role limited to facilitation.
He noted the growing demand for solar solutions due to high electricity costs, stating that 10,000 to 12,000 MW of additional capacity could be added under net metering.
