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ISLAMABAD: Finance Minister Miftah Ismail has said the government is assessing its options to provide further relief to inflation-stricken masses in electricity bills.
“There are two reasons for higher electricity bills,” the finance minister said “the increase in tariff in line with the International Monetary Fund’s (IMF) condition and expensive electricity generation combined with higher temperatures in May.”
Earlier, Prime Minister Shehbaz Sharif had formed a committee to deliberate what relief can be given to people using between 200 and 300 units of electricity per month, he said while addressing a press conference in Islamabad.
The minister said the government had activated all power plants to meet the increased power demand, including a furnace oil plant in Jamshoro that had a variable cost of Rs69 per unit.
“Our anticipated charges were Rs6 [per unit] but actual charges were around Rs100 because coal became very expensive and gas [prices] were the highest on record. May was very hot. There was a day when electricity demand rose beyond 30,000 megawatts. We generated 25,000MW which was the maximum we can.”
“The temperatures [in May] were five to seven degrees Celsius higher than usual,” he said, adding that the increased power generation was more expensive because of higher spot rates in March and April.
The Power Division sent a summary to the National Electric Power Regulatory Authority (Nepra) in June, following which hearings were held and the regulator granted approval to include fuel charges adjustment (FCA) in July, he explained. Consequently, the FCA was included in the bills for that month, he added.
The prime minister was very “worried” about the impact of the charges on small consumers, Ismail said. He added that the Power Division, after discussions, had informed the IMF the government would remove FCA on those using less than 200 units.
“The government will lose Rs20-21 billion from this. We have removed FCA on 56 per cent of consumers.” He added.