The Pakistani Government has authorised the increase of electricity prices in the country by up to PKR5.75/kWh (US$2c/kWh), which represents a 19% increase.
However, households consuming 200 kWh or less (63% of all consumers) will be exempt from the tariff increase, and another 31% would qualify for a partial subsidy.
The increase is part of a deal with International Monetary Fund (IMF) under which Pakistan must reduce unsustainable public debt in the power and gas sector.
Debts to power generation companies have accumulated to nearly PKR2,600bn (US$9.04bn), which show a separate government debt of around PKR1,600bn (US$5.56bn) to the gas sector.
Earlier in January 2023, the government also implemented an increase in the average power tariff by PKR4.96/kWh for the financial year 2023-24, raising the average tariff to PKR29.78/kWh.
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