Pakistan power price overhaul to boost inflation while aiding industry
Pakistan's new energy pricing plan will increase household bills by up to 50 percent to support industrial growth. Analysts warn the shift could spark inflation.
Pakistan 
PK has proposed a significant restructuring of its electricity tariff system, effectively ending the cross-subsidy model where the industrial sector (textiles and manufacturing) has historically subsidized household energy bills. The plan, announced on February 11, 2026, is expected to remove approximately 102 billion rupees in subsidies. This policy shift is a key component of utility reforms linked to the International Monetary Fund (IMF) and aims to rationalize the cost of power across different consumer categories.
PK has proposed a significant restructuring of its electricity tariff system, effectively ending the cross-subsidy model where the industrial sector (textiles and manufacturing) has historically subsidized household energy bills. The plan, announced on February 11, 2026, is expected to remove approximately 102 billion rupees in subsidies. This policy shift is a key component of utility reforms linked to the International Monetary Fund (IMF) and aims to rationalize the cost of power across different consumer categories.The Pakistan power ministry and the National Electric Power Regulatory Authority (NEPRA) are central to the implementation of these changes. According to market analysts, the proposal would result in a 13% to 15% reduction in electricity prices for businesses. This move is intended to provide relief to state power firms and enhance industrial productivity. However, the removal of the cross-subsidy will have a direct impact on residential grid consumers, with a majority of households facing higher costs.
