Electricity Bills Set to Rise as NEPRA Reviews Fuel Cost Adjustment Petition
Electricity consumers across Pakistan are bracing for a potential increase of Rs1.41 per unit in their upcoming bills. This anticipated hike follows a public hearing conducted by the National Electric Power Regulatory Authority (NEPRA) to consider a petition filed by the Central Power Purchasing Agency (CPPA). The petition seeks an adjustment of Re0.48 per unit in the tariff under the monthly Fuel Cost Adjustment (FCA) for December 2025.
Daytime-Specific Package to Mitigate Solar Energy Impact
In response to the evolving energy landscape, the federal government is developing a strategic initiative to address the challenges posed by solar energy adoption. A Power Division official disclosed plans for a daytime-specific electricity package during the public hearing. This package aims to counter the impact of solar energy on the national grid and boost daytime consumption by offering electricity at marginal cost.
The official explained that the negative FCA of Re0.93 per unit from November is set to expire in January. If NEPRA approves the proposed Re0.48 per unit increase for December, consumers will face a net increase of Rs1.41 per unit. This adjustment reflects the complex dynamics of fuel costs and energy demand in Pakistan's power sector.
Industrial Sector Voices Strong Opposition to Tariff Hike
Industrial consumers expressed vehement opposition to the proposed increase during the hearing. Representatives argued that electricity prices are already prohibitively high, and further adjustments would severely impact competitiveness. One industrial representative stated, "Instead of reducing power prices, a hidden increase is being imposed." They highlighted that from January 1, 2026, industrial tariffs have reportedly increased by Rs2 to 3 per unit, contrary to expectations of a reduction.
Power sector officials responded by noting that while the FCA may rise, the quarterly adjustment is expected to decline, potentially offering some relief in the coming months. They attributed the current hike to seasonal factors, explaining that hydel power generation decreases during winter, leading to greater reliance on more expensive fuels. Production typically improves in summer, which could help reduce future FCA charges.
Significant Rise in Electricity Consumption and Demand
Data presented during the hearing revealed a substantial increase in national electricity consumption. The CPPA reported a 22 percent rise compared to the same period last year, driven primarily by higher demand from industrial and agricultural sectors. Specifically, industrial consumption increased from 2 billion units in December 2024 to 2.4 billion units in December 2025.
Officials noted that approximately 44 percent of industrial and 39 percent of agricultural consumers have benefited from recent power packages, saving an estimated Rs6.9 billion up to December 2025. Overall electricity production has enhanced by 2.4 percent on an annual basis, indicating growth in the sector's capacity.
Solar Energy's Growing Influence on Grid Dynamics
The National Power Control Centre (NPCC) provided insights into peak demand trends, showing a significant year-on-year increase. Peak demand rose from 13,792 megawatts in December 2024 to 14,886 megawatts in December 2025. Despite this higher demand, NPCC officials highlighted that solar energy is gradually reducing grid consumption, particularly during daytime hours.
They revealed that 9,000 to 10,000 megawatts of electricity is now generated daily through net metering and off-grid solar systems. This decentralized generation is affecting demand from the national grid, prompting the government's initiative to introduce a daytime-specific package to balance consumption patterns.
Regulatory Challenges and Future Steps
NEPRA officials acknowledged the complexities involved in preparing industry reports, which require data from over 200 institutions. Efforts are underway to improve the accuracy and effectiveness of these reports to ensure transparent regulatory decisions. Following the public hearing, NEPRA stated it would review all submitted data and issue a detailed decision after thorough analysis.
The outcome of this review will have significant implications for consumers and industries alike, shaping Pakistan's energy affordability and sustainability in the coming months.
