In a first, Government plans to introduce flat electricity rate for winter
At the current moment, two different rates for peak and off-peak hours are under application.
The government has decided to introduce a cheap flat electricity rates for consumers in winter, for more power consumption. This has been done so due to a capacity trap.
The move has been made, despite the reduction in electricity consumption as ‘peak hours’ in summers turn in to ‘learn hours’ in winter. Due to the low consumption, power companies cease to utilize the fuel ordered by the government for running power plants.
Ultimately, the consumers face loss as they make the payments but aren’t utilizing electricity, and due to extreme line-pack pressure, there is a possibility of a gas pipeline explosion.
A decision similar to this was taken in the late 1990s, back when the government had started encouraging the use of high consumption due to surplus power. Despite these exceptions, the government and companies have been raising the slogan of ‘save electricity, for yourself and for the country’.
Irfan Ali, Power Secretary, while talking to the Senate Standing Committee on Power stated that a flat price scheme will be launched in November, under which electricity will be offered at a cheap supply.
Further on, he said that the Ministry of Energy was working on the scheme, which will be implemented in the on-going month.
“Looking at our revenue requirements, the government will introduce uniform rates in winter.” – He said.
Two different rates applicable currently:
At the current moment, two different rates for peak and off-peak hours are under application. During the off-peak hours, the end-cost for consumers is increased.
During summers, more electricity is used in peak hours than off-peak hours, as the commercial activities are maximum and electric equipment (e.g. air conditioners) are being used. Now, the peak and off-peak rule will no longer be in practice and a flat rate throughout the day will be implemented, which will cut down the cost of electricity.
The power secretary stated that the total circular debt stood at Rs. 1,200 billion and investment couldn’t be done until this debt was paid. He said that currently 35,000MW electricity was present in the system and more projects were under development, but in winters the consumption sometimes decreased to 5,000MW.
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