Electricity and Gas Bills Reform: Subsidies to Be Linked With Household Income

ISLAMABAD: The federal government is preparing a major reform in how electricity and gas bills are calculated. Under the new plan, subsidies will be linked to household income instead of electricity or gas consumption.

Officials said the initiative is part of ongoing commitments to the International Monetary Fund (IMF) under its Extended Fund Facility program. This marks a shift from the current slab-based system to a more targeted income-based approach.

The government aims to ensure that only eligible households receive financial support. Wealthier consumers will pay closer to actual energy costs. This reform is also expected to integrate with Pakistan’s existing social protection programs to identify deserving beneficiaries.

Authorities added that discussions with the IMF are ongoing to revise tariffs without overburdening lower- and middle-income households. The changes also aim to reduce cross-subsidies and tackle the circular debt problem that has long affected Pakistan’s power sector.

Energy experts say that this move could modernize Pakistan’s electricity and gas pricing system and make subsidies more transparent. If implemented effectively, it will benefit low-income families while promoting efficiency in the energy sector.

The government is expected to finalize the plan soon, after which a phased rollout of income-based subsidies could begin across the country.