Inter-Disco tariff differential subsidy slashed

ISLAMABAD: The government has slashed budgeted inter-Disco tariff differential subsidy by 12 percent to Rs 57.5 billion from Rs 65 billion in 2017-18 due to late submission of claims and recovery through Tariff Rationalisation Surcharge (TRS), well-informed sources told Business Recorder.

The government has budgeted Rs 105 billion for 2018-19 as tariff differential subsidy keeping in view expected increase in generation and subsequent electricity sale this summer, sources added. The ECC recently extended Tariff Rationalisation Surcharge at Rs 20.07 per unit to offset the impact of the subsidy.

“We are expecting 10-12 percent increase in sale of electricity this summer which will certainly have impacted on the subsidy,” the sources maintained.

The government, however, is worried about the expected jump in inter-circular debt this summer which may disturb power sector’s financing arrangements.

The sources revealed that the government recently paid Rs 50 billion to the energy sector whereas an additional Rs 50 billion will be distributed amongst the energy sector entities next week. PSO’s power sector debt is around Rs 300 billion.

Published in Business Recorder, 12th May, 2018