Karachi, April 3, 2025 – Prime Minister Shehbaz Sharif is expected to announce a significant reduction in electricity tariffs today, April 3, 2025. The anticipated cut of Rs 8 per unit in electricity prices is part of an effort to ease the financial burden on consumers amid rising energy costs.
An important meeting chaired by Prime Minister Shehbaz Sharif will take place today, gathering key federal ministers and senior officials to discuss the latest reforms in Pakistan’s energy sector. The meeting is expected to highlight the steps taken by the government to bring down the cost of electricity for consumers. Power Minister Awais Leghari is set to provide a detailed overview of the factors that have contributed to the proposed tariff reduction.
The main drivers behind this price reduction include the termination of agreements with six Independent Power Producers (IPPs), as well as the renegotiation of contracts with 16 other IPPs under a more favorable take-and-pay model. Another crucial step is the conversion of baggasse power plants’ contracts from US dollars to Pakistani rupees, which is expected to help stabilize electricity pricing. Additionally, a reduction in the return on equity (ROE) for government-owned power plants to 13%, fixed at an exchange rate of Rs168, has played a key role in recalibrating electricity tariffs.
Recent reports also suggest that the reduction in global oil prices since mid-March has allowed the government to save around Rs168 billion. This saving is expected to contribute an additional Rs 1.30 per unit cut in electricity tariffs. The International Monetary Fund (IMF) is expected to approve these measures, recognizing the government’s efforts to stabilize the economy by freezing fuel prices for the next three months.
In line with this, the government plans to make Rs6 of the Rs 8 reduction permanent, ensuring a lasting relief for consumers. Furthermore, there are discussions about the possible elimination of the Rs35 Pakistan Television (PTV) fee that is currently added to electricity bills. This change is expected to be implemented by July 2025.
This announcement forms part of Prime Minister Shehbaz Sharif’s broader economic strategy, aiming to tackle inflation and energy shortages while ensuring compliance with IMF guidelines. As the country faces economic challenges, including high inflation, today’s electricity tariff cut could provide much-needed relief to consumers, helping to restore public confidence in the government’s economic management.