Electricity consumers across Pakistan are set to receive a tariff reduction of up to Rs 4 per unit in their April 2025 electricity bills.
This relief is a result of an increase in the Tariff Differential Subsidy (TDS) by Rs 1.71 per unit, benefiting consumers of Discos and K-Electric, except lifeline users. The relief comes as part of the government’s broader strategy to manage electricity tariffs and reduce financial burdens on consumers.
The Power Division has already submitted a formal request to the National Electric Power Regulatory Authority (NEPRA), outlining the federal cabinet’s approval to increase the TDS. NEPRA is scheduled to hold a public hearing on April 4, 2025, to review and finalize the proposed changes, which aim to offset rising electricity prices.
According to reports, the increase in TDS is linked to an estimated revenue collection of Rs 160 billion from the Petroleum Levy (PL), which was raised by Rs 10 per litre on petroleum products. While the Prime Minister’s Office had previously assured that the impact of this levy would not be passed on to the public, it was later clarified that the additional revenue would be utilized to reduce electricity tariffs.
Sources indicate that the Oil & Gas Regulatory Authority (OGRA) projects a monthly revenue collection of Rs 40 billion from this levy, leading to a total Rs 160 billion impact over the quarter. Some estimates suggest a higher total collection of up to Rs 58 billion, considering revenue from mid-March 2025 as well.
The Rs 1.71 per unit reduction in tariff follows the Rs 2 per unit reduction in Quarterly Tariff Adjustment (QTA) applied earlier in the fiscal year. While consumers will lose the Fuel Cost Adjustment (FCA) relief of Rs 2 per unit in April, they will still benefit from the TDS reduction, resulting in a net decrease of around Rs 4 per unit in electricity bills.
Additionally, further reductions of up to Rs 8 per unit are anticipated in the coming months, contingent on finalizing revised agreements with Independent Power Producers (IPPs). Negotiations with the International Monetary Fund (IMF) are ongoing to implement these reductions, which are expected to stem from cost savings of nearly Rs 4 trillion by restructuring IPPs and Gas Power Plants (GPPs) contracts.
The Power Division highlighted that NEPRA’s previous determinations had set the national electricity tariff at Rs 35.50 per kWh for FY 2024-25, but the government had notified a lower average tariff of Rs 32.99 per kWh in October 2024, bridging the difference through TDS. The government has also ensured a uniform tariff structure for K-Electric consumers through additional subsidies.
With the federal cabinet’s approval on March 26, 2025, the proposed tariff relief is now awaiting final clearance from NEPRA under Section 31 of the NEPRA Act. Once approved, the reduction in electricity tariffs will be officially notified, bringing much-needed relief to households and businesses across Pakistan.