Breaking News: NEPRA Flat Rate Rs22.98 to Boost Industrial Power

The NEPRA Flat Rate Rs22.98 to Boost Industrial Power has emerged as one of Pakistan’s most significant energy reforms in recent years, aimed at reviving industrial performance and stabilizing electricity demand across key sectors. The National Electric Power Regulatory Authority (NEPRA) has announced that the new flat-rate package will remain in force for three years, providing long-term price certainty and relief to industries and farmers.

NEPRA’s Move to Strengthen Economic Recovery

This development follows months of consultation between the Power Division policy team and the energy regulator. The government’s objective is clear — to restore growth in industrial and agricultural electricity consumption, which has sharply declined in recent years due to high tariffs and economic slowdown.

Data presented by the Power Division shows that over the past three years, electricity use in industries has dropped by 14%, while the agricultural sector has suffered an even steeper fall of 47%. This dramatic decline, coupled with the increasing shift toward private net-metering systems, has created a significant challenge for grid utilization and national energy revenue stability.

By introducing a fixed per-unit rate of Rs22.98, NEPRA intends to make grid electricity more affordable, allowing industries and farms to expand production while improving overall system efficiency. The package will not only support business continuity but also prevent further deindustrialization caused by volatile power pricing.

Three-Year Incremental Consumption Package

Under the newly announced incremental consumption package, the flat electricity price of Rs22.98 per unit will be applicable to all industrial and private agricultural consumers connected through XW-DISCOs and K-Electric.

The plan defines incremental consumption as power usage that exceeds the reference benchmark established between December 2023 and November 2024. Any consumption beyond that limit will qualify for the discounted rate, effectively rewarding consumers who increase their operational demand.

Officials have clarified that this scheme is subsidy-neutral, meaning it will not add any financial pressure on the federal budget. Instead, the policy aims to promote higher productivity through better system utilization, encouraging industrial units to operate more shifts and agricultural users to rely more on electricity for irrigation instead of diesel-based alternatives.

Public Hearing and Stakeholder Engagement

A formal NEPRA public hearing 2025 is scheduled for November 11, during which stakeholders, industrial associations, and agricultural representatives will discuss the technical framework of the scheme.

This open consultation process allows for transparent evaluation of the proposal’s long-term impact on Pakistan’s energy and industrial landscape. The hearing will be held virtually via Zoom, ensuring easy access and participation from across the country.

NEPRA’s leadership has emphasized that this policy represents a balanced step between affordability and fiscal responsibility. The regulator expects that higher demand from industrial and agricultural consumers will eventually lower the overall cost burden on the power system.

Key Conditions and Tariff Rules

According to officials, the NEPRA Flat Rate Rs22.98 to Boost Industrial Power will include several safeguards to ensure cost control and fair implementation. Positive Fuel Cost Adjustments (FCAs) will continue to apply on eligible units, while negative FCAs, Quarterly Tariff Adjustments (QTAs), and Debt Service Surcharges (DSS) will not be imposed on incremental usage.

To prevent excessive revenue losses, the program will undergo semi-annual reviews. If consumption growth exceeds 25% over the baseline level, NEPRA will reassess the tariff to address marginal cost variations. Likewise, if two consecutive reviews indicate that higher tariffs are needed to maintain balance, the scheme will automatically terminate.

These built-in checks ensure that the initiative remains stable and beneficial without compromising the financial integrity of the energy sector.

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Eligibility and Benchmark Criteria

All Captive Power Plants (CPPs), typically operated by large industrial facilities, will be treated as new consumers for calculating baseline consumption. This means that factories currently producing their own power will now have the incentive to shift back to grid electricity under the new flat-rate plan.

Additionally, net-metering consumers will qualify for incremental benefits only if they have net imports of electricity in the respective billing month. Their incremental benefit will be calculated based on imported units during both peak and off-peak hours, ensuring fairness between self-generating and grid-dependent consumers.

This hybrid approach ensures that both industrial users and modern energy producers are encouraged to contribute toward overall grid stability.

Impact on Industrial Electricity Rates and Agriculture

The industrial electricity rates under this package will help revive competitiveness in export-oriented industries such as textiles, cement, and manufacturing. Businesses struggling with unpredictable tariffs will now enjoy greater planning certainty, enabling them to restore production capacity and rehire labor.

Meanwhile, the agricultural power tariff benefits are expected to help farmers reduce irrigation costs, increase cultivated area, and move away from expensive fossil fuels. Energy experts have praised the initiative, saying it directly supports rural livelihoods while simultaneously improving load factors for distribution companies.

Officials also highlighted that similar measures in the past — including the Industrial Support Package (2020-23) and the Bijli Sahulat Program (2024-25) — successfully revived demand by nearly 14%. The new scheme builds on those successes with broader eligibility and longer duration.

Power Division Policy and Sustainability

The Power Division policy team has described the scheme as a “demand-driven reform,” emphasizing that sustainable energy growth cannot rely solely on increasing capacity; it must focus equally on encouraging usage within productive sectors.

By locking in a predictable flat electricity price, the division aims to eliminate the uncertainty that has discouraged industrial expansion in recent years. The plan also complements the government’s ongoing initiatives to control circular debt and reduce capacity payment obligations that arise when plants operate below optimal load.

In its analysis, NEPRA noted that the flat-rate design aligns with Pakistan’s goal of ensuring “energy for growth,” rather than “energy for subsidy.”

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Energy Experts Welcome NEPRA’s Decision

Economists and power analysts have largely welcomed the NEPRA Flat Rate Rs22.98 to Boost Industrial Power, describing it as a strategic measure to restore balance in the electricity market. They argue that consistent tariffs are key to maintaining investor confidence and attracting industrial expansion.

Some experts also believe that by lowering costs, Pakistan could regain export competitiveness in energy-intensive sectors, while farmers could improve their irrigation practices without relying on diesel or grid instability.

Ultimately, the package is expected to strengthen system utilization efficiency, reduce idle generation, and foster energy discipline across the board.

A Policy for Sustainable Growth

By implementing the NEPRA Flat Rate Rs22.98 to Boost Industrial Power, the government is signaling a shift from short-term relief to structured economic reform. The new approach combines affordability, accountability, and investment-friendly stability — all crucial for Pakistan’s path toward industrial revival and agricultural resilience.