ISLAMABAD: Talks between the Power Division, All Pakistan Textile Mills Association (APTMA) and the Power Planning and Monitoring Company (PPMC) on the proposed elimination of electricity tariff peak hours for industry have reportedly been put on ice due to differences over the authenticity of load factor data, well-informed sources told Business Recorder.
APTMA updated the Prime Minister’s Office (PMO) through Adviser to the Prime Minister Dr Syed Tauqir Hussain Shah.
During a recent public hearing at NEPRA, Additional Secretary (Power Finance), Power Division, Mehfooz Bhatti stated that the government would soon approach the regulator regarding the peak-hours tariff for industry.
In consultations on the industrial peak-hours issue, APTMA informed the PMO that its team held two working-level sessions with PPMC. During these meetings, both sides reviewed the data presented in the initial meeting with the Minister for Power.
APTMA shared a detailed analysis of peak-hours industrial load factor under a weighted-average tariff, supported by actual textile sector data and consumer behaviour patterns.
According to APTMA’s analysis, the additional load on the grid would be approximately 400MW—significantly lower than the 1,200MW estimated by the Power Division.
However, PPMC maintains that within the assumed load factor range, most B3 and B4 consumers would face higher electricity bills due to the operationalisation of higher-cost power plants. APTMA; however, considered this conclusion premature.
However, as noted by Working Group head Shehzad Saleem during the initial meeting, there may be sufficient headroom in already operational lower-cost plants to absorb the increased demand. Moreover, higher load levels could improve plant efficiency. However, APTMA states that the analysis on available headroom has not yet been shared with it.
READ MORE: APTMA slams high energy tariffs
APTMA cited four power plants— Port Qasim, Engro Qadirpur, Haveli Bahadur Shah, and Balloki— as example. According to its understanding, during December 2025 these plants were operational and had an average peak-time headroom of approximately 1,350MW— more than sufficient to absorb an additional 400MW load.
In the merit order for December 2025, their specific generation costs stood at Rs. 12.08/kWh, Rs. 11.66/kWh, Rs. 20.37/kWh and Rs20.57/kWh, respectively,
APTMA further argued that, according to NEPRA’s State of Industry Report 2025, these four plants charged Rs. 21.9 billion under Partial Load Adjustment during FY2025, indicating suboptimal utilization. Additional load, it contends, could reduce fuel and variable O&M costs.
The textile industry also pointed out that under the incremental power package, all consumption above the baseline is billed at Rs. 22.98/kWh, regardless of whether the base tariff structure is Time-of-Use (ToU) or weighted average. Therefore, the incentive to increase peak-hour consumption already exists under the incremental regime.
However, PPMC responded that during peak hours the system operates under stressed conditions, with marginal generation costing approximately Rs. 35/kWh. Any increase in peak-hour consumption would therefore require dispatch of higher-cost plants, pushing up the weighted-average tariff.
APTMA countered that since incremental consumption is already billed at Rs. 22.98/kWh irrespective of ToU hours, the marginal consumption incentive exists independently of the base tariff structure. Thus, any peak-hour cost impact cannot logically be attributed to replacing the ToU tariff with a weighted-average tariff.
APTMA further argued that a thorough, evidence-based conclusion would require detailed analysis of hourly load factors of power plants operating during peak hours. It noted that during working-level discussions, concerns were raised about data and resource limitations in conducting such an analysis.
“We note that hourly generation profiles of power plants are surely compiled by various entities under the Power Division. We are ready to utilise our own resources to conduct the necessary analysis so that the Working Group on Energy may present informed, evidence-based recommendations to the Prime Minister in the best interest of the power sector, industry,” it further noted.
During July–December 2025, APTMA members’ grid consumption in Punjab increased by an average of 123 percent. Applying this increase to the 15–17 percent load factor observed during July–December 2024 results in a revised load factor of approximately 33–34 percent.
APTMA also conducted mill-level analysis for December 2025—the first month of the incremental package. Based on sanctioned load; (i) Peak load factor: 39.65 percent; and (ii) off-peak load factor: 40.15 percent. This implies an overall load factor of 40.06 percent.
These load factors include uptake under the incremental power package, where consumption above the benchmark is billed at Rs. 22.98/kWh— substantially lower than the prevailing effective rate of Rs. 34–36/kWh on benchmark consumption.
According to APTMA, this demonstrates two key points: (i) availability of cheaper electricity above the benchmark raises overall load factor by 2–7 percentage points on average and; (ii) since electricity is available at Rs. 22.98/kWh regardless of ToU hours, peak load factor converges toward off-peak load factor but remains slightly lower.
APTMA maintains that the data does not support the assumption of a 50–70prcent load factor following the abolition of peak-hour tariffs. Even with incremental consumption priced at Rs. 22.98/kWh, the textile sector’s load factor is around 40 percent.
It further argues that since abolition of peak-hour tariffs would apply to all B3 and B4 consumers— not just textile units— the appropriate baseline load factor should be derived from sanctioned load and existing B3/B4 peak and off-peak consumption data.
Under a single weighted-average tariff, peak-hour load factor would converge toward off-peak levels but would not exceed them, APTMA added.
Copyright Business Recorder, 2026
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