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ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has abolished 'peak hours' electricity rates for industries by according approval, in principle, to the proposed amendment in the SROs for both the DISCOs and K-Electric to charge 'off peak' hour rates from Nov-June 2021.

The ECC meeting presided over by Adviser to the Prime Minister on Finance and Revenue, Dr Hafeez Shaikh, on Thursday considered the Power Division's case for abolishment of time-of-use tariff scheme for industrial consumers to spur industrial activity in the midst of Covid-19 pandemic by removing the distinction between the current system of peak and off-peak hours as a part of industrial support package.

The underlying rationale is to incentivise industrial units to operate round the clock and produce greater output during testing times, the finance ministry said.

The ECC accorded approval, in principle, to the proposal regarding amendment in the respective SROs both for the DISCOS and K-Electric to charge the off-peak rates against peak hours.

The abolishment of peak and off-peak tariff structure would be implemented from November 01, 2020 till 30 April 2021.

Minister for Privatisation Muhammad Mian Soomro, Minister for Economic Affairs Khusro Bakhtiar, Minister for Railways Sheikh Rashid Ahmed, Adviser to the PM on Commerce Razak Dawood, Special Assistant to Prime Minister (SAPM) on Revenue Dr Waqar Masood, Special Assistant to Prime Minister (SAPM) on Power Tabish Gauhar, and Adviser to the Prime Minister on Institutional Reforms and Austerity Ishrat Hussain participated in the meeting.

Governor State Bank of Pakistan Dr Reza Baqir joined the meeting through a video link.

On November 3, 2020, the prime minister announced Industrial Support Package (ISP) to encourage higher power consumption and manufacturing by removing 'peak hours' electricity rates to allow 'off peak' hours throughout the current fiscal year.

Additionally, the prime minister added that all industries, big or small, would pay 25 percent less on consumption of additional electricity for the next three years.

He added that additional consumption of electricity by small and medium industries would be available at 50 percent discounted cost from November 1, 2020.

The premier further explained that if SMEs were paying Rs16 per unit before, now they would pay Rs8 per unit on consumption of additional electricity from November 1, 2020. He added that the package was being announced to increase exports and productivity and described the expensive electricity as one of the major factors that did not allow the country's industries to compete with regional players in the global market.

Copyright Business Recorder, 2020