The Power Division is considering introducing a new optional tariff mechanism aimed at facilitating industrial consumers and enhancing overall efficiency in electricity utilisation.
The development is part of the special initiative by the Federal Minister for Power, Sardar Awais Ahmed Khan Leghari, read a statement on Wednesday.
As per the statement, several internal consultative and technical meetings have already been undertaken in this regard.
Under the proposed framework, industrial consumers will have the flexibility to opt into a multi-slab tariff structure, where energy pricing is based on average marginal cost signals across defined time-of-use slabs.
This approach is designed to better reflect the actual cost of electricity supply during different periods, it said.
The tariff will consist of two primary components:
Fixed Charges: These will be determined based on Maximum Demand Indicators (MDI) and are expected to be relatively higher. This will incentivise consumers to optimise and reduce their peak demand.
Variable Energy Charges: These will be significantly rationalised and aligned closer to actual energy costs, enabling more cost-reflective pricing.
This structure is expected to encourage efficient load management by allowing industries to align their operations with lower-cost time periods.
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It would also promote higher electricity consumption during off-peak hours, improving the system load factor. Moreover, the system would incentivise peak demand reduction, thereby reducing stress on the grid and minimising the need for costly capacity additions.
It would also support industrial productivity and competitiveness through more predictable and potentially lower energy costs.
Overall, this tariff reform is expected to act as a catalyst for sustainable industrial growth in Pakistan, improving energy efficiency while supporting long-term economic development, read the statement.
Leghari, after technical proposals, has been directed to ensure inclusivity and effectiveness for the proposed regime through extensive stakeholder consultations.
In this regard stakeholders consultations will be conducted with industrial consumers, chambers of commerce, and trade bodies across the country. Feedback from these engagements will be incorporated to refine the mechanism.
The ministry said that the first consultative conference will be held online tomorrow, March 26.
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