ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has announced a reduction in electricity prices for consumers across the country under the monthly fuel charge adjustment (FCA), official notifications issued on Thursday stated.

Power tariffs for K-Electric (KE) consumers will see a cut of Rs3.0218 per unit in their bills, while for the rest of the country, they have been slashed by Re0.4641 per unit.According to the notifications issued by the power sector regulator, the relief will be reflected in April's electricity bills. 

The price reduction for KE applies to the January 2025 adjustment, while the reduction for other parts of the country is based on the February 2025 adjustment.Unaffordable tariffs have stirred social unrest and shuttered industries in the $350 billion economy, which has contracted twice in recent years as inflation hit record highs. This FCA reduction applies to most categories except for lifeline consumers, electric vehicle charging stations, protected consumers, and prepaid customers. Additionally, Nepra has decided to pass on a relief of Re0.90 per unit to all power distribution companies (Discos) consumers (except lifeline and protected categories) over three months from April to June 2025, amounting to a total benefit of Rs23 billion.The federal government last month announced reinstating benefits of fuel cost adjustments for electricity consumers using up to 300 units and agricultural tube-wells, aiming to ease the financial burden on households and farmers.The benefit of reduced fuel adjustment charges was initially stopped for consumers using up to 300 units in June 2015, according to a spokesperson of the Power Division. 

Nepra also confirmed that the adjustment will be effective for domestic users with Time of Use (ToU) meters, regardless of their consumption levels.The FCA revises electricity tariffs based on fuel cost fluctuations. A fall in the fuel prices leads to reduced power bills, and vice versa.In addition to the monthly FCA reductions, Nepra has approved a negative quarterly adjustment of Rs1.9004 per unit for Discos and KE consumers, excluding lifeline and prepaid customers.

This adjustment, amounting to Rs56.38 billion for the second quarter of FY 2024-25, will be applied over three months from April to June 2025. The quarterly adjustment will be shown in electricity bills during this period, providing additional relief to inflation-hit consumers facing high power costs.In recent years, Pakistan has been forced to increase its electricity tariffs under an International Monetary Fund (IMF) deal as part of efforts to reduce unsustainable public debt in the power and gas sectors.According to the lender, liquidity conditions in the power sector remain acute, with a buildup of arrears and frequent power outages.

The arrears — a form of public debt that accumulates due to subsidies and unpaid bills — were a major issue in the negotiations between the IMF and Islamabad before a deal was reached.