In relief to consumers, ECC rejects domestic gas tariff hike, approves increase for industry
The Economic Coordination Committee (ECC) on Saturday rejected a proposal by the Petroleum Division to increase gas tariffs for domestic consumers, citing the need to provide relief amid surging inflation.
The ECC met in Islamabad under the chair of Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb and was attended by officials of the finance and petroleum division.
Following a thorough discussion, the ECC, however, approved a hike in gas tariff for industrial captive power plants from Rs3,000 per mmBtu to Rs3,500 per mmBtu to ensure the required revenue for the gas sector during the fiscal year 2024-25.
The ECC also tasked the Petroleum Division to take necessary measures for the imposition of a grid transition levy on the captive power plants to boost the efficiency of the energy sector.
Last month, the Oil and Gas Regulatory Authority (OGRA) determined an increase in the gas price by 8.71-25.78% across the country, to be effective from January 1, 2025.
The Ogra determined the Review of the Estimated Revenue Requirement (RERR) of the Sui Northern Gas Pipelines Limited (SNGPL) and the Sui Southern Gas Company Limited (SSGC) for FY2024-25.
Under the review, the gas sale price has been increased by 8.71% for consumers in Sindh and Balochistan in the jurisdiction of the SSGC and 25.78% for consumers in Punjab and Khyber Pakhtunkhwa, falling under the SNGPL.
The regulator increased the gas sale price by Rs1778.35 per mmBtu for every category consumer of Sui Northern and Rs1762.51 per mmBtu for every consumer of Sui Southern.
T country is navigating a challenging economic recovery path and has been buttressed by a $7 billion facility from the International Monetary Fund (IMF) in September.
Pakistan’s consumer inflation rate slowed to an over 6-1/2-year low of 4.1% in December, largely due to a high year-ago base. That was below the government’s forecast and significantly lower than a multi-decade high of around 40% in May 2023.
