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ISLAMABAD: Prime Minister Shehbaz Sharif is expected to announce a long-awaited decrease in electricity prices Thursday (Apr 3), with the new price expected to be lowered by Rs8 per unit.

An important meeting chaired by Prime Minister Shehbaz Sharif is set to take place today, featuring key federal ministers and senior officials.

The meeting will focus on various reforms in the energy sector that have led to the recent price decrease, with the power minister Awais Leghari giving an overview of the factors behind the proposed changes.

Cut in power rates: PM to announce package

The expected price reduction stems from several strategic measures, including the termination of agreements with six Independent Power Producers (IPPs) and the renegotiation of contracts with 16 other IPPs under a take-and-pay model.

Additionally, the conversion of baggasse power plants’ currency from US dollar to Pakistani rupees and a reduction in the return on equity (ROE) for government power plants to 13%, fixed at an exchange rate of Rs168, have been critical in recalibrating electricity tariffs.

The reports indicated that the calculations for the tariff reduction also take into account the recent decline in global oil prices since mid-March, which is expected to save the government approximately Rs168 billion. This saving is projected to facilitate an incremental Rs1.30 cut in power tariffs.

The International Monetary Fund (IMF) is expected to endorse this announcement, recognizing the government’s efforts to stabilize the economy by freezing fuel prices for three months.

In addition to the anticipated cuts, the government aims to make Rs6 of the Rs8 reduction a permanent fixture in electricity pricing.

There are also reports regarding the possible elimination of the Rs35 Pakistan Television (PTV) fee linked to electricity bills, with implementation expected by July 2025.

This electricity price reduction is part of Prime Minister Sharif’s broader economic agenda, which aims to alleviate the financial burden on consumers while maintaining compliance with IMF guidelines.

As the country grapples with economic challenges, including inflation and energy shortages, today’s announcement could signal a significant step towards easing public discontent and restoring confidence in the government’s fiscal management.

Copyright Business Recorder, 2025

Comments

200 characters
Mubasal Apr 03, 2025 10:22am
Right steps at the perfect time when the industry is teetering on the brink of collapse. A very welcome step by the government to reduce power tariffs by Rs 6-8 per unit.
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Mumtaz Malik Apr 03, 2025 10:41am
The Prime Minister is performing well, and I hope he also takes steps to reduce the prices of fuel, including petrol, electricity, and gas. The rising cost of essential utilities is becoming,
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Mumtaz Malik Apr 03, 2025 10:43am
The rising cost of essential utilities is becoming a significant burden on the people, especially the middle class. Gas consumers, in particular, are facing additional charges of PRs 1,000 per month,
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Mumtaz Malik Apr 03, 2025 10:44am
If they exceed a certain consumption limit. This policy seems unfair, as it implies that middle-class households are not entitled to use gas for heaters during the winter.
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Mumtaz Malik Apr 03, 2025 10:45am
With the increasing cost of living, it is crucial for the government to introduce relief measures to ensure that basic necessities remain affordable for everyone.
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Mumtaz Malik Apr 03, 2025 10:45am
Lowering fuel and utility prices will not only ease financial pressure on the public but also contribute to economic stability and growth.
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Mumtaz Malik Apr 03, 2025 10:56am
The Premier must keep in mind that after dedicating 35 years of service, an industrial worker retires from an industrial concern only to face severe financial difficulties.
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Mumtaz Malik Apr 03, 2025 10:57am
Under the EOBI pension scheme, retirees receive a meager amount ranging from PRs 8,500 to PRs 10,000 per month, which is barely enough to cover basic necessities.
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Mumtaz Malik Apr 03, 2025 10:58am
Unfortunately, in the last budget, EOBI pensioners were completely ignored, while salaries and other benefits for both National and Provincial Assembly members were happily announced.
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Mumtaz Malik Apr 03, 2025 10:59am
Is this not an act of cruelty towards pensioners? How are they expected to survive? How can they afford essential medicines?
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Mumtaz Malik Apr 03, 2025 11:00am
Is there any dedicated budget to support them, or are they left with nothing but a negligible amount? The government must address this issue urgently to ensure that retired workers.
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Mumtaz Malik Apr 03, 2025 11:02am
The government must address this issue urgently to ensure that retired workers receive a dignified and livable pension.
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