Electricity tariff calculation methodology: FPCCI urges Nepra to hold awareness session

ISLAMABAD: The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) have requested the National Electric Power Regulatory Authority (NEPRA) to hold an awareness session on electricity tariff calculation methodology to support industrial competitiveness.

In a letter to the Registrar of NEPRA, the FPCCI stated that the country’s business community holds the regulator in high esteem and views it not merely as a regulator, but as a partner in Pakistan’s journey toward energy security, industrial competitiveness, and sustainable economic growth.

According to the FPCCI Energy Advisory Committee, high and uncompetitive electricity tariffs remain one of the most critical factors undermining the cost competitiveness of Pakistan’s industrial sector.

“Our industries — particularly exporters — are struggling to survive in international markets, not due to lack of capacity or skill, but due to the sheer burden of energy costs, which are significantly higher compared to regional competitors. Unless the cost of doing business, especially electricity, is brought to competitive levels, Pakistan’s industry will continue to lose ground, and pressure on the balance of trade will intensify,” the letter stated.

FPCCI emphasized that in the spirit of collaboration and collective problem-solving, its Energy Advisory Committee is keen to work closely with NEPRA and the Power Division to explore avenues for reducing industrial tariffs. However, it stressed that meaningful engagement requires a clear understanding of the tariff determination mechanism. The federation noted that without this foundational knowledge, its policy input and recommendations risk being misaligned with the regulatory framework.

FPCCI has proposed that the Chairman NEPRA nominate a senior technical officer from the Tariff Division to conduct a detailed briefing session covering key aspects, including: (i) methodology for determining B1, B2, B3, and B4 consumer tariff categories; (ii) Cost of Service (CoS) principles; (iii) role of voltage levels in tariff differentiation; (iv) impact of load factor on tariff computation; (v) key technical parameters applied in tariff setting; and (vi) comparison between current and legacy tariff structures.

The session is expected to be attended by members of the FPCCI Energy Advisory Committee, including Zarak K Khattak, Aamir Shaikh, Haneea Isaad, Farhan Nasim, Engr Zeeshan Ali, Engr Asad Mehmood and Rehan Javed.

FPCCI has suggested that, given the geographical dispersion of committee members, the session held virtually via Zoom at a mutually convenient time to ensure maximum participation and interactive discussion.

The federation also recommended inviting representatives from the Pakistan Leather and Footwear Sector (PALSP) and the All Pakistan Textile Mills Association (APTMA), noting that both bodies represent major export-oriented industries and are significantly affected by high electricity tariffs. Their inclusion, FPCCI said, would enrich the discussion and ensure broader industry representation.

Copyright Business Recorder, 2026