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Print Print 2023-09-05

‘Inflated’ power bills: Obdurate IMF refuses to buy into govt data

  • Conveys its disagreement to the data provided by the federal government
Published September 5, 2023

ISLAMABAD: The government is yet to finalise relief in soaring electricity bills to consumers as the International Monetary Fund (IMF) has conveyed its disagreement to the data provided by the federal government.

According to media reports, the government has proposed a relief of Rs 13,000 to consumers whose bills are between the range of Rs 60,000 to Rs 70,000 whereas Rs 3,000 will be for consumers using up to Rs 300 units.

Official documents available with Business Recorder reveal that tariff of lifeline consumers using 50 units has increased to Rs 4.74 per unit, consumers using 51-100 monthly will now pay 9.29 per unit, 1-100 protected, Rs 14.67 per unit, protected 101-200 units, Rs 17.46 per unit, non-protected 01-100, Rs 25.76 per unit, non-protected 101-200 units, Rs 33.52 per unit, 201-300 units, Rs 38.55 per unit, 301-400 units, Rs 45.97 per unit, above 400 units Rs 53.05 per unit. Time of Use (ToU) peak Rs 57.80 per unit and ToU off-peak 50.22 per unit. This includes base rate, QTAs, FCAs, Debt Servicing Surcharge (DSS) and taxes. The cumulative impact of FBR taxes on electricity consumers will be Rs 734 billion.

Shamshad informs Senate body: No ‘fiscal space available’ for subsidies

Power Division argues that as the rebasing was notified in the last week of July 2023, some adjustment of its application from July 1, 2023, became applicable in the billing month of August 2023.

As a result, domestic and commercial consumers were hit by Rs 7.64 to Rs. 15.0 per unit of tariff increase in the August 2023 bill. Moreover, already applied surcharges, quarterly tariff adjustments, fuel price adjustments and other FBR levied taxes were added to the overall increase in the electricity bills for the consumers across the country.

The caretaker Prime Minister on August 27, 2023 chaired a meeting and directed Power Division to suggest measures for provision of immediate relief to the consumers.

Accordingly, Power Division prepared a proposal for staggering of financial impact of FY 2023-24 rebasing for domestic and commercial consumers. The proposal has estimated cash flow impact of Rs 36.2 billion and this will result in markup implication of Rs 4.5 billion. The proposal has been shared with the IMF through Finance Ministry, and their response is still awaited.

Power sector’s total liability is Rs 3,478 billion plus Distribution Margin of Rs 341 billion whereas revenue including Prior Year Adjustment (PYA) is 2,503 billion plus distribution margin of Rs 431 billion, showing annual gap of Rs 976 billion.

The bifurcation of Rs 976 billion annual gap is as follows: (i) Discos under recovery Rs 263 billion;(ii) loss above NEPRA target Rs 201 billion; (iii) interest charge on IPPs Rs 177 billion; (iv) policy driven tariff differential Rs 451 billion; and (v) prior year FCA, QTA, PYA (117) billion.

Liability of Rs 3,478 billion plus DM of Rs 341 billion is comprised of fixed charges of Rs 2,344 billion and variable charges of Rs 1,134 billion. Of fixed charges of Rs 2,344 billion, share of Capacity Payment Price (CPP) is Rs 2,010 billion, Use of System Charges (UoSC) Rs 158 billion and mark up Rs 177 billion. The projected Circular Debt (CD) flow is Rs 392 billion.

The Power Division has sought fiscal support for flow of Rs 584 billion.

Copyright Business Recorder, 2023

Comments

Comments are closed.

Asim Sep 05, 2023 08:24am
Did IMF know what the previous govt did to IMF money? It gave Rs One billion to each MNA as hush money to buy their loyalty! Crooks snd their sponsors have ruined Pakistan! Generals rule is a curse for Pakistan!
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imran SZ Sep 05, 2023 10:09am
The end is near, may God protect us, our familities and everthing......
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Arif Sep 05, 2023 10:14am
Please do not demonise IMF , if government can save money they can give whatever relief they want . IMF doesn’t want government to spend something which they haven’t got . This out of control spending by government bring more inflation and misery.
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Notsurprised Sep 05, 2023 11:16am
Obdurate? For telling you NOT to give handouts when you have insufficient tax revenues? I call that sensible.
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Pacman Sep 05, 2023 11:24am
@Pakman, Generals are avoiding elections to save their skins for the massive human rights violations!
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Pacman Sep 05, 2023 11:26am
@Asim, Generals have abrogated the constitution and once again put country under defacto martial law, time for article six!
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KU Sep 05, 2023 11:27am
IMF is right to doubt our lies. That, ladies and gentlemen is the truth and nothing but the truth. We can imagine, helplessly, what more difficulties are to be dolled out by the incumbent government. But they shall not cut public sector expenses nor tax the untaxed nor stop electricity theft, these are mutually beneficial and perhaps areas closer to the hearts of their masters and servants.
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Muhammad Hasnain Sep 05, 2023 11:39am
A very good and needed initiative ... hope it is fulfilled inshAllah.
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Fazeel Siddiqui (Overseas Pakistani) Sep 05, 2023 12:01pm
Having dealt with Showbaz & Dark of the PML-N led PDM govt, IMF has learned extra immunity to lies of Pakistan.
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Pakman Sep 05, 2023 12:59pm
Mr Caretaker PM please discuss elections within 90 days if you are truly sincere to People of Pakistan and Pakistan itself.
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Love Your Country Sep 05, 2023 01:11pm
@Fazeel Siddiqui (Overseas Pakistani), you forgot one name here I think
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IMTIAZ CASSUM AGBOATWALA Sep 05, 2023 01:13pm
I think we have not done our homework properly. Don't blame the IMF .
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Yogesh (India) Sep 05, 2023 01:14pm
IMF also help these cronies .All are of same colour. Never touch the rich people. ONLY lip service.
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Johnny Walker Sep 05, 2023 01:45pm
and they are still fudging figures to fool the IMF. No lessons learnt from Dar's disastrous lying and fudging that crippled this country. I wonder why this caretaker PM wears Western suits? Is this the normal dress of the land of the pure or does he believe he will be more acceptable to IMF and the uniform wearing boots?
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PTI worker Sep 06, 2023 04:16pm
@Asim, I agree previous PTI government ruined Pakistan.
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Sagar Baloch Sep 06, 2023 10:14pm
Already defaulted.
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