ISLAMABAD: The Ministry of Energy is considering introducing an optional tariff mechanism aimed at supporting industrial consumers and improving efficiency in electricity usage under a special initiative of Federal Minister for Power Division and Energy Awais Ahmed Khan Leghari.
According to a press release issued on Wednesday, the minister has chaired several internal consultative and technical meetings to review the proposed framework.
Under the proposed mechanism, industrial consumers will be given the option to adopt a multi-slab tariff structure in which electricity pricing will be based on average marginal cost signals across defined time-of-use slabs, allowing tariffs to better reflect the actual cost of supply during different periods.
The proposed tariff will comprise two main components, including fixed charges based on Maximum Demand Indicators (MDI), expected to be relatively higher, and variable energy charges aligned more closely with actual electricity costs. The ministry said the model is designed to encourage industries to optimise and reduce peak demand while improving cost-reflective pricing.
The statement added that the structure is expected to promote efficient load management by enabling industries to shift operations to lower-cost periods, increase electricity consumption during off-peak hours and improve the overall system load factor. It will also help reduce pressure on the national grid by incentivising peak demand reduction and minimising the need for costly capacity additions.
The initiative is also aimed at supporting industrial productivity and competitiveness by providing more predictable and potentially lower energy costs, contributing to sustainable industrial growth and long-term economic development.
The minister has directed officials to ensure inclusivity and effectiveness through extensive stakeholder consultations. Engagements will be held with industrial consumers, chambers of commerce and trade bodies across the country, with feedback to be incorporated into the final mechanism.
The first consultative conference in this regard will be held online on March 26.