LPG Prices Scale New Heights While Winter Approaches; Power Division Warns of Potential Electricity Tariff Hikes, Quarterly Adjustments, and Increased Load Shedding
ISLAMABAD: With the onset of winter, Pakistan’s electricity users are again gripped by fear as the government has announced the possibility of power load shedding and significant tariff increases due to the changing seasonal electricity production patterns and rising international fuel prices.
The Power Division sources said that as the water level drops, the hydel generation will decrease considerably and will have to depend on costly thermal generation. Hence increase in fuel price (FCA) in the month of December to February may lead to substantial rise in electricity costs whereas the electricity tariffs are expected to go up by Rs 1.30 per unit with the upcoming quarterly adjustment.Key Highlights of Winter Power Sector Challenges and Rising LPG Prices: Officials say production of hydel power is negligible during the winter, with water shortfalls of more than 22 per cent in the Indus River System Authority (IRSA).
The next quarterly tariff adjustment is expected to see a 1.30 per unit hike in the cost of electricity, adding to consumers’ financial burden of more than Rs 22 billion.Rising International Fuel Prices for LNG, Coal and Other Base Fuels: The price for liquefied natural gas (LNG), coal and other raw materials have soared in the international market, causing costs for power generation to rise.
In addition, it is difficult to obtain local gas supplies for power plants in winter, and it is likely that the load-management and load-shedding plans will be more stringent from December to February.
As the region grapples with tensions, so has the price of LPG, which has been pushed into a vicious circle of high inflation because of the wider tensions in the region affecting energy markets. The price of LPG has skyrocketed in the past year, further driving up cost of energy for the common people, with household cylinder prices reaching unprecedented levels.