The National Electric Power Regulatory Authority (NEPRA) has increased the special electricity rate for additional consumption by industrial and agricultural consumers to Rs. 25.30 per unit from Rs. 22.98, raising the cost by Rs. 2.32 per unit.

The revised tariff will apply to eligible consumers served by K-Electric and other power distribution companies under the Incremental Consumption Package (ICP), starting with the November 2026 billing cycle.

NEPRA issued the decision through a formal regulatory order despite a 2-2 split among its four members.

NEPRA Members Oppose Higher Electricity Rate

NEPRA members Amina Ahmed and Maqsood Anwar Khan opposed the revised rate, arguing that the regulator had not received sufficient cost calculations to justify the new tariff.

They maintained that the actual marginal cost of additional electricity stood at Rs. 31.83 per unit, according to NEPRA’s assessment. They called for suspending the package until the required data and calculations were verified.

NEPRA Chairman Waseem Mukhtar acknowledged their objections but approved the revised rate using his casting vote after the authority remained evenly divided.

Industries Warn of Higher Electricity Costs

Industrial consumers have raised concerns that charging below the actual cost of additional electricity could create further financial pressure on the power sector.

They warned that the resulting cost difference could feed into fuel cost adjustments and ultimately shift the burden to consumers outside the incremental consumption scheme.

Introduced in December last year, the ICP was designed to encourage industries and agricultural consumers to use more electricity by offering additional units at discounted rates.

Under the arrangement, incremental electricity was initially priced below the regular industrial tariff, which stood at Rs. 34.50 per unit last month.

The scheme was also intended to ensure that the additional cost of supplying electricity to participating consumers would not be passed on to other users.

NEPRA Criticises Delayed Cost Calculations

All four NEPRA members criticised the Power Division and its related entities for failing to submit updated cost calculations within the required timeframe.

The regulator said it had requested the relevant information from the ministry six months ago and issued repeated reminders, but the required data had still not been provided.

The two dissenting members warned that setting the incremental rate below the actual cost could increase the average fuel cost recovered from all electricity consumers through the Fuel Cost Adjustment (FCA) mechanism.

They also cautioned that excluding additional consumption under the package from quarterly tariff adjustments could increase the burden on consumers who were not benefiting from the scheme.

NEPRA Threatens to Suspend Electricity Package

While approving the revised rate, Chairman Waseem Mukhtar said the concerns raised by the dissenting members deserved consideration but rejected immediate suspension of the package.

He gave the Ministry of Energy another opportunity to provide the outstanding information, including updated cost calculations.

NEPRA’s determination also sets deadlines for the relevant government entities to submit the required data.

Failure to meet these requirements could lead to suspension or termination of the incremental consumption package, along with legal proceedings under the applicable regulatory framework.