Allah Nawaz Khan
The continuous increase in electricity prices is causing immense distress to the middle class.Announcements were made that electricity would be free for consumers using 200 to 300 units.No one had much faith in those announcements, but no one expected the prices to rise this sharply either.By imposing various types of taxes, the public is being bled dry.Now, NEPRA has approved Rs. 200 billion in recoveries for the National Grid Company to cover system expenses.A request was made for revenue recovery over three years, which has now been approved. Recoveries are likely to begin from 1st August. These Rs. 200 billion will ultimately be paid by the public.Electricity prices have already gone beyond the public’s capacity to bear them. There is no need to say what new hardships the fresh price hikes will bring. An average middle-class family spends the entire month worrying about how they will pay the electricity bill.
Subsidy is being provided to consumers using up to 200 units. People make every effort to keep their usage within the 200-unit limit. If even one unit exceeds the limit, they end up paying heavy bills for almost five to six months. Now, even stricter conditions are being imposed for availing the subsidy. Eligibility will now be decided on the basis of poverty score.As a result, a large number of people will lose access to the subsidy. It is also possible that the subsidy may be completely eliminated.Sometimes minor reductions are made just to show a favour to consumers. In Pakistan, electricity consumers face enormous difficulties. Getting a new connection involves a long and tedious process. In addition to the official price, extra payments are demanded for obtaining a meter. Even when the meter is being installed, money is collected under the pretext of sweets. Later, various taxes also have to be paid. Now, a monthly meter rent has also been introduced.
There are several reasons for the high cost of electricity. The process of power generation itself is expensive, which increases the overall cost. Another reason is the use of expensive fuel instead of cheaper alternatives. Losses during transmission are also passed on to consumers. Circular debt and the depreciation of the rupee further push up electricity prices. Electricity theft is also recovered from paying consumers.Expensive agreements with power producers (IPPs) are also contributing to the rise in prices. Contracts have been signed with these companies under which payments must be made even if electricity is not purchased. Free electricity is provided to many people, and the cost of this free electricity is recovered from the general public.The biggest factor is the IMF. Price increases are made according to IMF directives. Electricity can be generated using cheap fuel and sold at affordable rates. Prices can also be reduced by reviewing the agreements with IPPs. Recovery should be made from those receiving free electricity. The transmission system should be improved to prevent theft and wastage. The subsidy system can also be improved to bring down prices.Merely making minor reductions in prices will not improve the system. Proper measures must be taken for real improvement. It is a strange system where payment has to be made even if electricity is not purchased. If immediate steps are not taken now, prices will rise even further in the future.Rising electricity prices are badly affecting domestic life. High bills lead to cuts in spending on education, healthcare, food, and other essential needs. If the bill is reasonable, money can be allocated for other necessities.Besides household life, the industrial sector is also severely affected. Expensive energy increases the cost of production, leading to an industrial crisis.If industries are provided affordable energy, production costs will decrease, which will significantly reduce poverty.The agricultural sector is also suffering.The industrial and agricultural sectors can provide stability to the country’s economy. If attention is not paid to these sectors, poverty, unemployment, food shortages, and many other problems will arise in the future.Internationally, fuel price increases justify electricity price hikes, but when fuel becomes cheaper, raising prices is nothing but injustice. The recovery of Rs. 200 billion will be extremely burdensome for the public. An ordinary consumer is being punished for staying alive by placing additional burdens on them.Such steps must be taken that actually reduce electricity prices. Benefit should also be taken from solar energy. Solar energy can be used from household to industrial levels.Negotiations should be held with IPP owners so they also reduce electricity prices.If the electricity crisis is not controlled, it will become more dangerous than other crises.
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