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The federal government is working on various options to reduce electricity tariffs, aiming to cut the cost of electricity by Rs10 per unit, as reported by national media on Tuesday.
Sources reveal that the first option under consideration is transferring the benefits of renegotiations with Independent Power Producers (IPPs) to the public. By terminating agreements with five IPPs, the government could save a total of Rs411 billion, amounting to an annual saving of Rs70 billion.
According to sources in the Ministry of Energy, altering the tariffs for eight bagasse-based power plants could result in savings of Rs238 billion, translating to Rs8.83 billion annually. Additional agreements with 16 IPPs could bring about a benefit of Rs481 billion. The savings from terminating or revising IPP contracts will directly benefit consumers.
Sources further stated that the government is also reviewing the possibility of extending the winter electricity relief package and is considering reducing the tax burden on electricity bills. Currently, the federal government collects over Rs800 billion annually through taxes on electricity bills.
These measures are aimed at reducing the cost of electricity by up to Rs10 per unit.
