Following Prime Minister Shehbaz Sharif’s announcement, the process of reducing electricity prices has begun, with the cost of electricity decreasing by Rs1.90 per unit across the country, including Karachi. The reduction is part of the quarterly adjustment mechanism, and the new price adjustment is effective from October to December 2024.
The National Electric Power Regulatory Authority (NEPRA) issued a notification confirming the reduction in electricity prices through quarterly adjustment. The average price of electricity has been reduced from Rs 45.05 to Rs 37.64 per unit. This reduction applies to all electricity consumers, including Karachi Electric (KE), and will remain in effect from April to June 2025, providing relief worth Rs 56.38 billion.
NEPRA also issued separate notifications for monthly adjustments. In Karachi, the price of electricity has been reduced by Rs 02 per unit, while for the rest of the country, the price has been cut by Rs0.46 per unit. The relief from these price cuts will be reflected in April’s electricity bills for consumers in the respective regions.
Exemption from Price Reduction for Lifeline Consumers
It is important to note that the reduction in electricity prices will not apply to lifeline consumers. The request for price cuts in the quarterly adjustment was made by the electricity distribution companies, and NEPRA held a hearing on the matter in February before approving the price reduction.
Prime Minister Shehbaz Sharif has also addressed the issue of circular debt, announcing that arrangements have been made to resolve the Rs2,393 billion circular debt issue. He assured that, within the next five years, circular debt will not remain a concern and will be completely eliminated. The Prime Minister also highlighted the difficulty of negotiating with the IMF for electricity price reductions, thanking the Army Chief and his team for their full cooperation towards achieving economic stability.
