ECC approves power relief package for winter

The Economic Coordination Committee (ECC) of the Cabinet approved on Tuesday a three-month winter electricity relief package announced by Prime Minister Shehbaz Sharif earlier this month.

Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb chaired the ECC meeting, where several key agenda items were discussed and decisions were made, read a statement released by the Finance Division.

“The ECC considered a proposal submitted by the Ministry of Energy (Power Division) regarding a winter demand initiative for the industrial, domestic (ToU and non-ToU consumers exceeding 200 units, commercial and general services consumers of discos and K-Electric to enable optimum use of system generation capacity besides reducing gas demand due to shifting of favourable demand towards electricity,” it said.

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As per the statement, it was proposed that under the initiative, a tariff of Rs26.07/kWh shall be charged to all eligible consumers on the respective incremental consumption, above the benchmark consumption in the corresponding months.

The initiative shall remain applicable for a three-month billing period effective from December 2024 to February 2024.

The benchmark consumption will be the higher of either the relevant month’s consumption in FY2024 or the historical consumption over the past 3 years for the relevant months, based on a formula and terms and conditions laid before the ECC.

The ECC discussed the proposal and approved it, calling the subsidy-neutral interim relief initiative worked out by the Power Division as “being timely and relevant given the recent surge in electricity tariffs and the reduced demand across various consumer categories”.

Earlier this month, PM Shehbaz announced a three-month electricity relief package for consumers to encourage electricity use during the low-demand winter season.

Giving detail of the package, the prime minister said domestic consumers would be charged with a flat rate of Rs26.07 per unit, saving Rs11.42 (30%) to Rs26 (50%) per unit on various tariff slabs.

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The industrial consumers would be able to save Rs5.72 to Rs15.05 per unit, saving 18% to 37%, while it would be Rs13.46 to Rs22.71 per unit for commercial users, PM Shehbaz said.

Moreover, the ECC also considered a proposal submitted by the National Disaster Management Authority (NDMA) for the transfer of Rs3.14 billion balances of erstwhile Emergency Relief Cell (ERC) into the NDMA Fund to carry out its inland as well as overseas rescue and relief operations in line with the statutory mandate of the Authority.

The proposal was discussed and approved with the proviso that since the balances in the ERC were made up of public donations and were granted for relief, rescue and rehabilitation of floods and earthquake victims, NDMA would spend these balances for the stated purpose, the Finance Division said.