ISLAMABAD: Pakistan’s power regulator has jacked up the electricity tariff by Rs4.96 per unit for the ongoing fiscal year (FY24) in line with the conditions of the International Monetary Fund (IMF), a statement from the body said on Friday. 

Pakistan’s National Electric Power Regulatory Authority (NEPRA) determines different consumer-end tariffs for each of the power distribution companies in the country. The companies have different revenue requirements and are allowed to have separate levels of transmission and distribution losses. 

Once determined, NEPRA sends the tariffs to the federal government to incorporate subsidies or surcharges, after which a uniform application of the tariff is filed to be charged to consumers. 

“The revised National Average tariff for the FY 2023-24 has been determined as Rs.29.78/kWh, which is Rs.4.96/kWh higher than the previously determined national average tariff of Rs. 24.82/kWh,” NEPRA said in a statement. 

“The increase of Rs.4.96/kWh is mainly due to overall low sales growth, rupee devaluation, high inflation, exorbitant interest rates, and addition of new capacities.” 

The development comes after the IMF approved a $3 billion bailout fund for Pakistan last month to save the cash-strapped South Asian country from a looming default. 

To release the funds, the lender had imposed a set of conditions on Pakistan, which included an increase in electricity prices as the country’s electricity economics were unsustainable, with circular debt ballooning to Rs2.6 trillion. 

NEPRA said the country’s total revenue requirement of power distribution companies was projected at Rs3,281 billion and a projected sales of 110,165 GWh for the FY 2023-24. 

“Any relief of a decrease in tariff will be directly transferred to the consumers in the future, in case of appreciation of PKR, decrease in inflation and interest rates, among others,” the regulator added.