Subsidies vs Relief: Power tariff scaled up to 350 pc in last two decades
PMLN succeeded in stabilizing the power tariff in last three years of their government.
(WebDesk) - A sharp steep in the charges of the electricity bills is being observed in last 15 years. According to an estimate, the hike in power tariff rises up to 350 percent. An average electricity consumer which uses 300 units of electricity a month – is now paying Rs. 12.09 per unit which was Rs 2.29 in 2003.
A constant increase in the price per unit of electricity is the core reason of an increase in power tariff especially in last decade.
According to the experts, in addition to the fuel surcharges in the electricity bills, subsidies accorded by the government is the major cause of the hike in electricity bills.
In last two decades only, a hike in power tariff rises up to 350 percent. Photo: File
Government in a quite less cost facilitates the consumers with the electricity. Per unit of electricity costs government more than it costs to an average electricity consumer. The difference between this per unit buying cost to per unit sale cost resulted in the bitter pill of subsidy which government have to swallow to relief a consumer.
The delayed payments of the subsidies to the power plants and power generating companies created a chaotic circular debt which has now surged to Rs. 1100 billion.
Also Read: NEPRA raises electricity price by Rs 3.90 per unit
To suppress the budget deficit and to decrease the circular debt – government over a period of time slowly and gradually decreases the subsidy to the electricity consumers and the burden of electricity prices is being shifted to the consumers solely.
.jpg)
PMLN succeeded in stabilizing the price per unit in last three years of their government. Photo: File
An average consumer with a usage of 300 unit paid Rs 2.29 for a unit in 2003 is now paying Rs. 12.09 per unit since 2013.
Similarly, a consumer who has a usage of electricity units in between 300 to 701 is now suppose to pay Rs. 16 per unit which was around Rs. 3 for the same consumer back in 2003.
Rs. 18 per unit is being paid by the consumers who are using the electricity in between 701 to 1000 and above 1000 units a month.
Same consumer used to pay Rs. 4.42 in 2003 for the same consumption of electricity.
A cautious overview of the price hike in previous 15 years has been given below:
The increasein prices of the electricity unit over a span of nearly two decades. Infogram
According to the data, a major increase in power tariff can be seen in 2012 - the last year of the PPP tenure when the electricity crisis was at peak which was later stabalized in the last five years of PMLN government. PMLN succeeded in stabilizing the price per unit in last three years of their government.
The new PTI led government is all set to increase the power tarif by Rs. 4 or more along with the suggessions to end the subsidies. National Electric Power Regulatory Authority (NEPRA) has hiked the electricity price per unit by Rs 3.90 after being pressurised by the distribution companies.
NEPRA passed five-year tariff agreement which will raise the electricity price for a defined period. The prices will remain Rs. 3.9/unit high for the duration of five years. Moreover, monthly users of 100 units will have to pay a tariff of Rs 0.9 on every unit.
The power division was seeking an approval for implementation of National Electric Power Regulatory Authority’s (Nepra) determination suggesting a gross increase of Rs3.90 per unit in consumer tariff
Also the soaring prices of furnace oil in the international market can also be a reason to further hike in price per unit as furnace oil is the major constituent of power production.
Also Read: Increase in power tariff expected due to rise in furnace oil’s price
With inputs from Dunya News
