Pakistan Electricity Bills Could Rise Rs1.73 Per Unit

Electricity consumers across Pakistan could face an additional charge of approximately Rs1.73 per unit after the Central Power Purchasing Agency-Guaranteed (CPPA-G) sought a positive fuel-price adjustment for electricity generated during August 2026.

The National Electric Power Regulatory Authority (NEPRA) has completed a hearing on the request but has not yet issued its final determination.

CPPA-G has sought an adjustment of approximately Rs1.7267 per kilowatt-hour (kWh) under the monthly Fuel Charges Adjustment mechanism.

If NEPRA approves the request at or near the proposed rate, the adjustment could place an estimated Rs29.5 billion additional burden on electricity consumers, including consumers in K-Electric’s service territory.

However, the proposed Rs1.73 increase should not be confused with a permanent Rs1.73 increase in Pakistan’s base electricity tariff.

It is a monthly fuel-cost adjustment linked to electricity generated in August 2026.

What Has NEPRA Decided?

As of September 30, NEPRA has reserved its decision after conducting a hearing on CPPA-G’s petition.

This distinction is important.

The Rs1.73 per unit figure is currently the proposed adjustment, not the final amount consumers will necessarily pay.

NEPRA will examine the generation data, fuel costs and adjustment claims before publishing its detailed determination.

The final approved amount could therefore be:

Rs1.73 per unit

lower than Rs1.73

or otherwise modified following NEPRA’s calculations.

Consumers should wait for the regulator’s final notification before treating the amount as confirmed.

What Is the Proposed Electricity Increase?

CPPA-G’s request is approximately:

Rs1.7267 per unit

for electricity generated during August 2026.

Rounded to two decimal places, that is approximately:

Rs1.73 per unit.

The adjustment arises because the actual fuel cost of electricity generation differed from the reference fuel cost already built into the tariff.

Pakistan uses the monthly FCA mechanism to pass these differences to consumers.

How Much Could It Add to Your Bill?

If NEPRA ultimately approves the full Rs1.7267 per unit, the basic calculation is straightforward:

Units consumed × Rs1.7267

For example:

These figures illustrate the adjustment itself.

They should not be interpreted as the total increase in the final payable bill because applicable taxes, tariff rules and consumer-category treatment can affect the final amount.

The calculation also depends on the units to which NEPRA’s eventual FCA notification applies.

Why Is Electricity Becoming More Expensive?

The proposed adjustment reflects differences between the reference fuel cost incorporated into electricity tariffs and the actual cost of producing electricity.

Pakistan generates electricity using several sources.

During August, the power-generation mix included:

Hydropower

Imported coal

Local coal

RLNG

Natural gas

Nuclear power

and other sources.

Changes in how much electricity comes from each source can materially affect the overall generation cost.

Pakistan Generated 14.46 Billion Units in August

According to figures presented during the proceedings, total electricity generation during August stood at approximately:

14.464 billion units.

The reported average generation cost was around:

Rs8.82 per unit.

The composition of that electricity matters because different technologies have very different generation costs.

Hydropower Was the Largest Source

Hydropower accounted for approximately:

37.84%

of electricity generation during August.

This is important because hydropower generally has relatively low direct fuel costs.

A strong hydropower contribution can therefore reduce Pakistan’s reliance on more expensive imported fuels.

But hydropower availability varies with:

Water flows

Reservoir conditions

Season

and

System requirements.

The generation mix can consequently change considerably from one month to another.

Imported Coal Supplied 15.59%

Imported coal accounted for approximately:

15.59%

of generation.

Unlike domestic energy sources, imported coal exposes Pakistan’s electricity sector to international commodity prices and exchange-rate movements.

If international coal prices rise or the Pakistani rupee weakens, the cost of producing electricity from imported coal can increase.

Local Coal Contributed 10.86%

Local coal supplied approximately:

10.86%

of total generation.

Pakistan has expanded power generation from Thar coal in recent years to reduce dependence on imported fuels.

Using domestic coal reduces some foreign-exchange exposure.

However, coal-fired electricity still carries:

Operating costs

Transportation costs

Financing costs

and

Environmental consequences.

Fuel cost is only one component of the final electricity tariff.

RLNG Supplied 8.48%

RLNG-based power plants accounted for approximately:

8.48%

of electricity generation.

The reported cost of RLNG-based generation reached approximately:

Rs45.92 per unit, making it the most expensive major generation source identified in the figures presented during the hearing.

That number helps explain why changes in the generation mix can have such a significant impact on monthly fuel adjustments.

When expensive imported fuels account for a larger portion of generation, average fuel costs can rise rapidly.

Local Gas Accounted for 7.04%

Domestic gas contributed approximately:

7.04%

of total generation.

Local gas can generally provide a different cost profile from imported LNG.

However, Pakistan’s domestic gas supplies are constrained.

Power plants therefore compete with:

Households

Industry

Fertilizer producers

and other sectors for limited domestic gas resources.

Why Was RLNG So Expensive?

RLNG stands for Regasified Liquefied Natural Gas.

Pakistan imports LNG in liquid form.

It must then be transported, regasified and supplied to consumers, including power plants.

The final generation cost can therefore be influenced by:

International LNG prices

Shipping costs

Terminal charges

Exchange rate

and

Power-plant efficiency.

Because LNG is internationally traded and largely priced in foreign currency, Pakistan is exposed to external energy-market movements.

What Is Fuel Charges Adjustment?

Fuel Charges Adjustment is a mechanism used to reconcile actual monthly electricity-generation fuel costs with the reference fuel costs already incorporated into electricity tariffs.

Suppose the reference fuel cost assumes electricity will cost a certain amount to generate.

If actual fuel costs turn out to be higher, CPPA-G can request a positive FCA.

Consumers may then pay an additional amount after NEPRA’s review.

If actual costs are lower than the reference, consumers can receive a negative FCA, effectively providing relief.

Therefore:

Positive FCA = additional charge

while

Negative FCA = relief.

FCA Is Not the Same as Base Electricity Tariff

This distinction is crucial.

Pakistan’s electricity bill contains several components.

These can include:

Base tariff

Fuel Charges Adjustment

Quarterly Tariff Adjustment

Taxes

Duties

and other applicable charges.

The proposed Rs1.73 is a monthly FCA.

It does not automatically mean Pakistan’s permanent base electricity tariff is increasing by Rs1.73 per unit.

Headlines simply stating “electricity price rises Rs1.73” can therefore create the wrong impression.

FCA Is Also Different From Quarterly Tariff Adjustment

Another common source of confusion is the Quarterly Tariff Adjustment or QTA.

FCA mainly reflects variations in fuel-related generation costs.

QTA can reflect broader power-sector costs over a quarter, including components such as:

Capacity payments

Transmission charges

Operation and maintenance costs

and other adjustments permitted under the tariff framework.

Consumers can sometimes receive a positive FCA and negative QTA at the same time.

The effects can partially offset one another.

Pakistan Has Already Seen This Happen

Earlier in 2026, consumers received an example of exactly this interaction.

For April 2026, CPPA-G had originally sought an FCA of around Rs1.73 per unit.

NEPRA ultimately approved a smaller positive FCA of approximately:

Rs1.19 per unit.

At the same time, a negative quarterly adjustment of approximately:

Rs1.9857 per unit

provided relief.

The combined effect resulted in net relief of roughly Rs0.80 per unit for affected consumers.

This previous decision demonstrates why a CPPA-G request should not be treated as the final consumer charge before NEPRA completes its determination.

Rs29.5 Billion Estimated Consumer Impact

If the proposed August adjustment is approved, the estimated additional amount recovered from consumers could be approximately:

Rs29.5 billion.

That represents the broader financial impact of the adjustment rather than a charge on any single consumer.

The amount would be spread across eligible electricity consumption according to the regulatory mechanism.

Around Rs20.7 Billion Is Linked to IPP Payments

CPPA officials reportedly told the hearing that approximately:

Rs20.7142 billion

of the proposed amount is directly associated with payments to Independent Power Producers.

Pakistan’s electricity market includes numerous privately operated generating companies.

Payments to generators depend on contractual arrangements and the electricity supplied to the national system.

These arrangements can feed into the adjustments considered by NEPRA.

Several Plant-Level Adjustments Were Presented

CPPA-G also submitted several individual adjustment claims during the proceedings.

These reportedly included approximately:

Rs1.3246 billion — Chashma Nuclear Power Plant C2

Rs528.1 million — Tavanir Iran

Rs183.8 million — Punjab Thermal Power

Rs159 million — Thar Coal Block-I Power Generation Company.

Smaller adjustments were also associated with several other power producers.

These figures form part of the detailed calculations reviewed by the regulator.

RLNG Plants Included a Large Provisional Adjustment

One significant item was a provisional adjustment of approximately:

Rs10.6168 billion

covering July and August for RLNG-fired power plants.

That is particularly relevant because RLNG generation was already among the most expensive sources during August.

NEPRA will examine these claims before determining the final FCA.

Some Previous Adjustments Were Reduced

The petition was not composed entirely of additional claims.

It also contained reductions in earlier adjustments.

These reportedly included approximately:

Rs10.7432 billion for July 2026

and

Rs2.2274 billion for June 2026.

There were also reductions involving individual generators.

These positive and negative adjustments are part of why NEPRA performs its own calculations rather than automatically approving CPPA-G’s requested rate.

Does the Proposed Increase Apply to K-Electric?

The proceedings indicate that the proposed adjustment would also affect consumers in K-Electric’s service area under the applicable uniform FCA framework.

Pakistan has increasingly moved toward applying national average uniform fuel-cost adjustments across DISCO and K-Electric consumers, subject to NEPRA’s determinations and applicable exemptions.

The final September decision will clarify exactly which consumer categories are covered.

Some Consumers Can Be Exempt From FCA

NEPRA’s previous FCA decisions have excluded certain consumer categories.

For example, previous determinations have excluded categories such as:

Lifeline consumers

Electric Vehicle Charging Stations

and certain prepaid consumers.

However, the exact exemptions for the August 2026 FCA should be taken from NEPRA’s final determination rather than assumed from earlier months.

The regulator can specify the applicable categories when it publishes the decision.

Why Your Bill Does Not Immediately Match the Month Named in FCA

There is normally a timing gap.

The proposed adjustment relates to electricity generated and consumed during August 2026.

But NEPRA first needs to:

Receive CPPA-G’s request

Review the data

Hold a hearing

Calculate the adjustment

and

Issue a determination.

The approved FCA is therefore collected in a later billing cycle.

This is why consumers can see an “August FCA” on a bill issued several weeks or months after August.

A 500-Unit Household Could See About Rs863 Before Other Effects

To put the proposed adjustment into perspective, consider a household whose applicable consumption is 500 units.

At Rs1.7267 per unit:

500 × Rs1.7267 = Rs863.35

So the FCA component would be approximately:

Rs863

before considering any applicable tax treatment or other adjustments.

For 1,000 units:

1,000 × Rs1.7267 = Rs1,726.70.

That illustrates why even apparently small per-unit adjustments can noticeably affect electricity bills.

High-Consumption Users Feel FCA Changes More

Because the adjustment is calculated per unit, its rupee impact increases directly with electricity consumption.

A household using 100 units would see a much smaller adjustment than one using 700 or 1,000 units.

The same applies to commercial and industrial users with substantially higher consumption.

This is one reason energy-intensive businesses closely monitor monthly FCA decisions.

Fuel Costs Remain a Major Electricity-Bill Risk

Pakistan’s electricity sector remains exposed to global fuel prices.

Imported:

LNG

Coal

and other fuels

can create foreign-exchange requirements.

When international energy prices rise, the effect can eventually reach consumers through mechanisms such as FCA.

A weaker rupee can amplify that effect because imported fuel contracts are generally linked to foreign currencies.

More Renewable Energy Can Reduce Fuel Exposure

Electricity generated from:

Hydropower

Solar

and

Wind

does not require imported fossil fuel in the same way as LNG or imported coal.

Increasing their share can therefore reduce exposure to international fuel-price volatility.

However, renewable generation creates its own system requirements.

Solar and wind are variable.

The electricity grid needs sufficient:

Transmission capacity

Storage

Flexible generation

and

Grid management

to integrate them reliably.

Therefore, adding renewable capacity alone does not eliminate all electricity-sector costs.

What Happens Next?

NEPRA has completed its hearing and reserved its decision.

The regulator will now review the information submitted during the proceedings.

It will then issue a detailed determination stating the approved Fuel Charges Adjustment.

Only at that point will consumers know the final per-unit amount.

The decision should also clarify:

Applicable consumer categories

Exemptions

Billing period

and

Implementation instructions.

Until then, Rs1.73 per unit should be described as proposed, not final.

What Consumers Should Watch

Consumers do not need to take any immediate action.

The key development to watch is NEPRA’s final determination.

Once issued, electricity bills should identify the fuel adjustment separately rather than silently adding it to the base tariff.

Consumers can therefore check the FCA line on their bill to see the actual amount charged.

The calculation can broadly be verified using:

Relevant units × approved FCA rate.

The Bottom Line

Pakistan’s electricity consumers could face an additional charge of approximately Rs1.73 per unit under the proposed Fuel Charges Adjustment for August 2026.

CPPA-G has sought approximately Rs1.7267 per unit, potentially placing an estimated Rs29.5 billion additional burden on consumers.

Electricity generation during August stood at approximately 14.464 billion units, with hydropower supplying the largest share at 37.84%.

RLNG accounted for only 8.48% of generation but was the most expensive major source reported during the proceedings, at approximately Rs45.92 per unit.

However, consumers should not yet treat the Rs1.73 increase as final.

NEPRA has reserved its decision.

The regulator must review CPPA-G’s calculations and issue its formal determination before the final rate and billing treatment are confirmed.

It is also important to understand that this is a monthly Fuel Charges Adjustment—not a permanent Rs1.73 increase in Pakistan’s base electricity tariff.

For consumers, the next important development will therefore be NEPRA’s final August FCA determination.