The most alarming aspect is the extension of fixed charges to protected consumers – those using up to 100 or 200 units per month and historically shielded through subsidised tariffs. Under the proposal, even a household consuming less than 100 units would pay Rs200 per kilowatt of sanctioned load. Since the charge is linked to sanctioned load rather than actual consumption, a modest 2kW connection could mean Rs400 per month regardless of usage. A 5kW connection at higher rates could mean Rs2,500. For many lower-middle-class households, this is a direct hit to already strained budgets. Independent analysis suggests the impact will be severe. Average tariffs for protected consumers in the first 100-unit slab could rise by as much as 76%.
This comes on the heels of the abolition of net metering and its replacement with net billing, giving the overall impression that self-generation is being discouraged just as grid reliance becomes more expensive. The stated aim is to recover the power sector’s Rs2.56 trillion fixed capacity cost and stabilise revenues. But shifting structural inefficiencies onto small consumers is not reform. It is fiscal convenience. If reform is necessary, it must begin with renegotiating capacity payments and curbing distribution losses while ensuring targeted subsidies remain intact for the truly vulnerable. Industry must be competitive, but not at the expense of households that are already rationing units to survive.