Winter power package’s complex calculation causes controversy

LAHORE: Pakistan’s winter electricity package sparks industry outrage and the heart of the controversy lies in the package’s complex and convoluted calculation, which industry experts claim is misleading and unfair.

The discounted rate of Rs 26.07/kWh for incremental consumption during December 2024, January 2025, and February 2025 is based on a weighted average of past three years’ consumption, a formula that has raised eyebrows among industry stakeholders.

The government has unveiled a winter electricity package, touted to boost electricity consumption during the winter months. However, industry leaders have lambasted the package, labeling it a “gimmick” that fails to address the sector’s pressing concerns.

Industry leaders argued that the previous incremental package of electricity was clear and straightforward, offering benefits on incremental consumption recorded for the month of the corresponding previous year. In contrast, the current package is shrouded in uncertainty, with benefits that are not explicit.

The package’s announcement, slated for implementation from December 1, 2024, has been met with confusion, as no official notification has been issued yet. This lack of clarity has only added to the industry’s frustration, which is already reeling from the impact of high electricity tariffs and capacity charges.

The withdrawal of gas supply to captive power customers from January 1, 2025, is expected to further exacerbate the situation, forcing industries to rely on the unreliable grid supply. Industry leaders warn that the high tariff and unreliable supply will devastate the industry, leading to shutdowns and a severe setback to the national economy.

As the industry struggles to stay afloat, leaders are urging the government to reconsider its policies and provide a sustainable solution to the energy crisis. They demand a clear and transparent policy that benefits the industry and supports the national economy. With the government’s policies in the energy sector having a disastrous impact on the industry, it’s time for policymakers to take notice and protect the interests of this vital component of the national economy.

Copyright Business Recorder, 2024