Under a special initiative by Federal Minister for Power Division Sardar Awais Ahmed Khan Leghari, the Power Division is considering the introduction of a new optional tariff mechanism aimed at facilitating industrial consumers and improving overall efficiency in electricity usage.
According to official sources, several internal consultative and technical meetings have already been held under the supervision of the minister on the proposed framework.
Under the planned system, industrial consumers will have the option to opt into a multi-slab tariff structure, where electricity pricing will be determined on average marginal cost signals across defined time-of-use slabs. The mechanism is designed to more accurately reflect the actual cost of electricity supply during different periods of the day.
The proposed tariff will include two main components: fixed charges and variable energy charges.
Fixed charges will be based on Maximum Demand Indicators (MDI) and are expected to be relatively higher, encouraging consumers to manage and reduce peak demand. Variable energy charges will be rationalised and aligned more closely with actual generation costs, allowing more cost-reflective pricing.
Officials said the structure is expected to encourage efficient load management, enabling industries to shift operations to lower-cost time periods and improve system load factors by increasing consumption during off-peak hours. It is also aimed at reducing peak demand pressure on the national grid and minimising the need for costly capacity expansions.
The reform is expected to enhance industrial productivity and competitiveness by providing more predictable and potentially lower energy costs, while supporting sustainable industrial growth and long-term economic development in the country.
The Federal Minister, after reviewing technical proposals, has directed that extensive stakeholder consultations be carried out to ensure inclusivity and effectiveness of the proposed regime.
In this regard, consultations will be held with industrial consumers, chambers of commerce, and trade bodies across the country, and feedback will be incorporated to refine the mechanism. The first consultative conference is scheduled to be held online on March 26.