By SKM
January 08, 2025
ISLAMABAD: The federal government has formally moved to enforce a uniform consumer-end electricity tariff across the country, including K-Electric’s service territory, as part of its effort to ensure financial sustainability of the power sector and rationalise inter-distribution company tariffs.
In a motion filed on January 8, 2026 with the National Electric Power Regulatory Authority (NEPRA), the Ministry of Energy (Power Division) asked the regulator to reconsider and issue a uniform schedule of tariffs for ex-Wapda distribution companies (XWDISCOs) under Sections 7 and 31 of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997, read with Rule 17 of the NEPRA Tariff Rules.
The move follows NEPRA’s consumer-end tariff recommendations for XWDISCOs under the Multi-Year Tariff (MYT) regime for FY2025-26, issued on January 7, 2026. The government said it had reviewed the regulator’s recommended tariffs for individual distribution companies and decided, in line with national policy, to apply a uniform tariff across regions.
Citing the National Electricity Policy, 2021, the Power Division noted that the financial sustainability of the sector hinges on recovery of the full cost of service through an efficient tariff structure, while gradually reducing the need for government subsidies, except for targeted segments such as lifeline, industrial or agricultural consumers. The policy also allows the government, based on socio-economic objectives and budgetary constraints, to propose a uniform tariff nationwide.
Under Section 31(4) of the Act, NEPRA is empowered to determine a uniform tariff for public sector distribution companies on the basis of consolidated revenue requirements. The ministry said NEPRA has consistently followed this approach, most recently through its uniform tariff determination notified via SROs issued on July 1, 2025.
Accordingly, the government has submitted a proposed uniform tariff, reflective of its economic and social policy objectives and based on NEPRA-approved consolidated revenue requirements of XWDISCOs, for cabinet approval. In anticipation of cabinet consent, the proposal has also been forwarded to NEPRA for consideration, along with details of targeted tariff differential subsidies.
Officials clarified that the inter-DISCO tariff rationalisation is not intended to generate additional revenue for the federal government, as it remains within the revenue requirements already determined by NEPRA. Instead, it aims to balance consumer interests, constitutional principles and policy goals.
If approved, the revised uniform final tariff will be notified by the federal government with effect from January 15, 2026, replacing or modifying existing tariff notifications issued in July 2025.
In a parallel move, the government has also asked NEPRA to maintain a uniform consumer-end tariff for K-Electric customers, even after privatisation, through direct or indirect subsidies. A revised government-applicable tariff for K-Electric consumers has been submitted for approval and is proposed to take effect from January 1, 2026, through an amendment to the relevant statutory regulatory order.
The motion also follows NEPRA’s recent determination of distribution tariffs for Multan Electric Power Company (MEPCO) under the MYT regime for FY2025-26 to FY2029-30, which has been formally conveyed to the government to facilitate the filing and notification of a uniform tariff application.
Power sector analysts say the government’s move reinforces its long-standing policy of nationwide tariff uniformity, shielding consumers in high-loss regions from higher electricity prices, but at the cost of continued reliance on subsidies and cross-subsidisation within the system. End
