ISLAMABAD: The government has reportedly decided to continue PM’s relief package of Rs 5 per unit for electricity consumers till June 30, 2022, well informed sources told Business Recorder.

Recently, IMF and World Bank, who were strongly opposing PM’s relief package, raised this issue with the officials of Power Division, who shifted the buck to the Finance Ministry. Sharing the details, sources said, on a summary for the ECC submitted by Power Division, the ECC of the Cabinet on March 7, 2022, approved a relief of Rs 5/kWh reduction in electricity bills for Discos and K-Electric’s commercial consumers having sanctioned load less than 5 kW and domestic non-ToU consumers having monthly consumption up to 700 units for a period of four months (from March to June 2022). Moreover, ECC of the Cabinet approved a supplementary grant of Rs 106 billion divided into four monthly instalments (Rs26.5 billion each) to be released at the beginning of each month. The relief package was notified in terms of Section 31 (7) of Regulation of Generation, Transmission and Distribution of Electric Power Act (NEPRA Act) 1997.

The downward spiral of the power sector

According to sources, Power Division has also apprised both the IMF and World Bank that since the approval has been granted by the Federal Cabinet and National Electric Power Regulator Authority (NEPRA), it cannot undo the package itself. The sources said, Finance Division has already released the approved amount of subsidy at the rate of Rs 26.5 billion per month till May 15, 2022. The remaining amount will be released in July 2022.

The sources maintained that a meeting was held in Finance Division on May 6, 2022 under the chairmanship of Minister for Finance and Revenue and it was advised that, given the fiscal constraints and budget deficit, the relief package of Rs 5/kWh approved by the Cabinet may not be extended for the month of May and June 2022 and a summary may be initiated by Power Division for the Cabinet to discontinue the relief package with effect from 1st May 2022.

Power Division, sources said, has submitted three summaries to the ECC proposing withdrawal PM Relief Package of Rs 5 per unit but the summaries have neither been considered nor approved so far which indicates that the government is in no mood to withdraw the package till June 30, 2022.

Copyright Business Recorder, 2022