NEPRA Announces Rs22.98 Flat Electricity Unit Rate for Industrial and Agricultural Users – Latest Update
NEPRA Announces Rs22.98 Flat Electricity Unit Rate for Industrial and Agricultural Users has officially announced a major electricity tariff update that directly impacts Pakistan’s industrial and agricultural sectors. Under the new policy, a flat rate of Rs22.98 per unit will be applied to incremental electricity consumption, meaning units consumed above the baseline will now be charged at a significantly lower cost. This decision is part of the federal government’s plan to revive industrial operations, support agricultural growth, reduce production costs, and boost economic recovery.
Industrial activity and agricultural output have both declined in recent years due to high power tariffs, unstable fuel prices, and rising input costs. The new flat rate is designed to encourage higher electricity consumption, restore market confidence, and help factories and farms operate more efficiently. This article explains all major details of the new tariff, its impact on users, eligibility criteria, baseline calculation, billing method, and expected economic benefits.
Why NEPRA Introduced the Rs22.98 Flat Rate:
The industrial and agricultural sectors have faced increasing electricity prices over the past decade, with average tariffs going above Rs30–Rs40 per unit. This resulted in:
- Lower factory production
- Reduced agricultural pumping operations
- Declining tube-well usage
- Higher cost of doing business
- Lower capacity utilization for power plants
Due to these pressures, electricity consumption in the industrial sector dropped by more than 14%, while the agricultural sector saw a reduction of nearly 47%. With demand falling, the government faced challenges in managing idle generation capacity and overall system inefficiencies.
To stabilize the electricity market, the government presented a relief proposal to NEPRA, leading to the approval of a fixed incremental rate of Rs22.98 per unit. This rate is significantly lower than the previous tariffs and is expected to encourage higher energy usage, helping in economic revival and improved power utilization.
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Who Will Benefit from the Rs22.98 Tariff?
The new flat rate is applicable to:
1. Industrial Consumers
All industrial users connected to:
- DISCOs (Distribution Companies)
- K-Electric
Industries producing textiles, steel, cement, pharmaceuticals, electronics, and food processing will experience reduced production costs.
2. Agricultural Consumers
Farmers using:
- Electric tube-wells
- Water pumps
- Irrigation systems
- Cold storage facilities
Agriculture is especially expected to benefit because high electricity costs previously forced many farmers to reduce tube-well usage.
How the Rs22.98 Rate Will Be Applied (Incremental Basis):
The rate is not applied to all consumed units. Instead, it applies only to the incremental units, which means:
Baseline Period
NEPRA will use consumption data from:
December 2023 to November 2024
This 12-month baseline determines how many units were consumed on average.
Incremental Units
Any electricity consumed above the baseline will be charged at Rs22.98 per unit.
For example:
- Baseline consumption: 10,000 units
- Current month consumption: 13,000 units
- Incremental units: 3,000 units
These 3,000 units will be billed at Rs22.98 per unit.
This encourages consumers to increase usage because the extra units are cheaper.
What Charges Apply on Incremental Units?
NEPRA has clarified the following:
Applicable Charges
- Positive Fuel Cost Adjustment (FCA)
Not Applicable
(Meaning NO EXTRA CHARGES on incremental units)
- Negative FCA
- Quarterly Tariff Adjustment (QTA)
- Debt Service Surcharge (DSS)
This makes incremental consumption significantly cheaper than standard billing.
How Long the Rs22.98 Tariff Will Remain in Effect:
The tariff plan is valid for:
Three Years
(From November 2025 to October 2028)
However, NEPRA may annually review the performance and impact of the plan.
Expected Economic Benefits:
1. Lower Production Costs
Industries will experience direct savings on electricity bills, enabling them to expand operations.
2. Increased Agricultural Output
Farmers will run tube-wells for longer hours due to cheaper incremental units.
3. Improved Power Utilization
With higher consumption, idle capacity in power plants will reduce.
4. Export Competitiveness
Sectors like textiles may benefit, helping Pakistan boost exports.
5. Job Creation
Increased industrial activity can create new employment opportunities.
Impact on Industrial Users:
Industrial production relies heavily on machinery, heating systems, motors, and continuous electricity supply. High tariffs previously limited operations to minimum capacity. With the new flat rate, industries can:
- Operate additional shifts
- Increase machinery usage
- Expand manufacturing hours
- Improve production efficiency
- Reduce energy-related losses
Many industries may now shift to electricity-powered alternatives instead of expensive diesel generators.
Impact on Agricultural Users:
Electricity is essential for agriculture, especially for:
- Irrigation using tube-wells
- Crop watering
- Water pumping for orchards
- Cold storage and preservation
High electricity costs previously discouraged farmers from using electric pumping systems. The new rate will:
- Increase tube-well operations
- Improve crop health
- Enhance water supply
- Reduce dependency on diesel pumps
- Support livestock and dairy farms
Agriculture remains the backbone of Pakistan’s economy, and cheaper electricity will support its stability.
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Billing Method Under the New Tariff:
The electricity bill will show:
1. Standard units charged at normal tariff
(based on baseline)
2. Incremental units charged at Rs22.98
These incremental units will appear in a separate line on the bill for transparency.
Limitations and Conditions:
The new tariff comes with a few conditions:
1. Applicable only to incremental consumption
If your consumption does not exceed the baseline, the rate does not apply.
2. Review every 6 months
NEPRA can adjust or discontinue if cost variations become too high.
3. Only for industrial and agricultural sectors
Commercial and domestic users are not included.
4. Policy will be revisited if incremental usage exceeds 25%
If consumption rises too much, NEPRA may revise the plan.
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FAQs NEPRA Announces Rs22.98 Flat Electricity Unit Rate for Industrial and Agricultural Users:
1. What is the new flat rate announced by NEPRA?
NEPRA has introduced a flat rate of Rs22.98 per unit for incremental electricity usage for industrial and agricultural users.
2. Who is eligible for the Rs22.98 rate?
All industrial and agricultural consumers connected to DISCOs and K-Electric.
3. Does the rate apply to total units or only incremental units?
It applies only to additional units above the baseline.
4. How is baseline consumption calculated?
The baseline is calculated by considering electricity usage from December 2023 to November 2025.
5. Will FCAs and QTAs apply on incremental units?
Only positive FCA applies. Negative FCA, QTA, and DSS do not apply.
6. How long will this tariff remain active?
For three years, with annual reviews.
7. Will this reduce my total bill?
Yes. Any additional units will cost significantly less, reducing your overall electricity bill.
8. Does this apply to commercial consumers?
No. Only industrial and agricultural consumers are covered.
Conclusion:
The NEPRA Announces Rs22.98 Flat Electricity Unit Rate for Industrial and Agricultural Users marks one of Pakistan’s most important tariff reforms in recent years. It offers major relief to two key sectors that support national economic growth. By lowering electricity costs on incremental consumption, the government aims to boost industrial activity, reduce agricultural input costs, increase production, and enhance overall economic competitiveness. If implemented effectively, this policy can play a crucial role in stabilizing Pakistan’s energy market and supporting long-term development.
