Islamabad: Federal Minister for Energy Owais Leghari admitted during a Senate session that the tariff approved by NEPRA for K-Electric is unjustified. Responding to a calling attention notice, the minister stated that K-Electric claims it is unable to recover 6.5% of its billed amount and insists that either the government or consumers should bear this loss—a demand he termed unacceptable. He revealed that the government has filed a review petition with NEPRA against the decision, and if accepted, it could save Pakistan Rs. 650 billion over the next seven years.
Leghari highlighted that NEPRA allowed 13.9% in line losses, which he described as excessive based on audit reports suggesting the figure should be around 8–9%. He also criticized K-Electric’s calculation of working capital costs, noting that while the utility company borrows from banks at KIBOR + 0.5% or 1%, it charges consumers at KIBOR + 2%, which is unfair.
The minister emphasized that for the first time in Pakistan’s history, the current government has thoroughly reviewed NEPRA’s decision and submitted a detailed review, challenging multiple cost components. He explained that tariff determination involves 8–9 segments, and the government requested reductions across all of them.
If the review is rejected, Leghari warned, K-Electric would unjustifiably receive Rs. 650 billion, a burden the entire nation would have to bear. He further stated that last year alone, the government paid Rs. 175 billion to K-Electric as tariff differential subsidy—funds that could have been used for significant development projects.
Leghari also noted that while government-owned DISCOs have their tariffs calculated based on 100% recovery, K-Electric was being granted a higher margin. Apart from the federal government, political parties including MQM and Jamaat-e-Islami have also filed review petitions against NEPRA’s decision.
