Costly electricity, inflation ‘killing’ businesses: FPCCI

LAHORE: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed grave concerns over the ongoing mass protests and said that Pakistani households and businesses are facing mounting power prices.

At a press conference, FPCCI President Irfan Iqbal Sheikh quoted Nepra’s latest forecast for power purchase prices for the fiscal year 2023-24 that reveals a substantial financial burden, with consumers to bear 68 per cent of costs for fixed capacity payments; primarily benefiting coal plants.

“The substantial fuel costs — particularly petroleum imports — potentially pose extreme volatility and strain on foreign exchange reserves; with no clear solution or governmental strategy in sight. As a result, consumer-end tariff has been increased and applicable with effect from July 1, 2023,” he told reporters.

Additionally, residential consumers pay an extra 20-25pc in the form of electricity duty, sales tax, and income tax and they are subjected to pay Rs35.57 per kWh for off-peak load and Rs41.89 per kWh for peak load. These charges exclude taxes, fuel cost adjustments, uniform quarterly adjustments, and additional surcharges.

“The FPCCI categorically and vociferously rejects the recent hike in electricity prices; because it is debilitating both for residential and commercial consumers; and, inflation already killing the businesses and rendering them unprofitable & bankrupt,” he added.

FPCCI chief said that currently, residential consumers are unable to pay their electricity bills across the country; and, on average, residential and commercial consumers pay 15-20pc extra in the form of uniform quarterly adjustments; fuel price adjustments, and additional surcharges.

Whereas, commercial consumers are also subject to further tax and extra tax in addition to electricity duty, sales tax, and income tax. In current bills, commercial consumers are paying 37-40pc of the total electricity charges in taxes and duties.