ISLAMABAD: The Petroleum Division announced on Tuesday a new levy rate of Rs1,243 per million British thermal units (mmbtu) for off-grid captive power plants (CPPs), for December 2025. A notification issued by the Petroleum Division stated that, under the Off-grid (Captive Power Plants) Levy Act 2025, the federal government has set the rate for the specified period.
The levy will be charged under section 3 of the Act, which was passed by Parliament earlier this year.
The government has set a target of Rs105 billion in revenue from this levy for the fiscal year 2025-26.
READ MORE: Applicable for Aug 2025: PD notifies Rs690/mmbtu levy for off-grid CPPs
The Act, which imposes a levy on natural gas and RLNG consumption by captive power plants, mandates that the proceeds be used to lower power tariffs across all consumer categories, excluding lifeline users.
The previous levy rate for August 2025 was set at Rs690 per mmbtu, and under the legislation, the levy will increase progressively.
It will rise by 5 percent over the industrial tariff initially, moving to 10 percent from August 2025, 15 percent from February 2026, and stabilising at 20 percent from August 2026 onwards.
For the earlier months of 2025, the levy was set at Rs570 per mmbtu for April, Rs550 for May, and Rs402 for June.
Copyright Business Recorder, 2026
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