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Pro rata is a relatively new term for most Pakistanis and you may wonder what is pro rata and how the term is used in Pakistan’s power consumption context. In simple words pro rata means an “average” estimate of electricity consumption per day. The word pro rata means proportionally.
Pro rata calculation does not necessarily mean power distribution companies are involved in the practice of over-billing. The system is erroneous because it leaves room for wrong billing. What if the consumer in our example completely stopped using electricity after 28 days of the billing cycle? Should they still pay for 300 units when they have consumed only 280 units.
It is important to note that this adjustment in units is not an overcharging practice by the electricity companies, such as IESCO, FESCO, LESCO, PESCO, and K-Electric.
Instead, it is a mechanism to ensure that the billing is in line with the 30-day NEPRA rule and in some cases it may benefit consumers.
A probe led by the Federal Investigation Agency (FIA) has blamed the so-called ‘pro rata system’ for over-billing to the electricity consumers in the country, especially those consumers who were previously covered under the non-protected category.
The pro rata system used for the calculation of electricity tariff slabs catapulted hundreds of thousands of consumers from “protected” slabs to non-protected slabs and consequently their electricity bills skyrocketed. There are reports that the government is planning to scrap the system.
