Govt rolls out Surplus Power Package to fuel industrial growth

November 07, 2025 (MLN): The Federal Government has approved a new Incremental Consumption Package 2025, also referred to as the Surplus Power Package.

This is aimed at stimulating electricity demand from industrial and private agricultural consumers across the country. 

The three-year package, cleared by the Cabinet under Case No. 758/Rule-19/2025/1030, seeks to promote grid sustainability by encouraging higher consumption during surplus generation hours.

According to an official communication issued by the Ministry of Energy (Power Division), the package offers electricity at a fixed rate of Rs22.98 per unit on incremental consumption beyond the reference period of December 2023 to November 2024. 

The incentive will apply to both Time-of-Use (ToU) and Non-ToU categories of industrial and agricultural consumers served by XW-DISCOs and K-Electric.

The Ministry stated that the measure is designed to counter the decline in power demand observed over the past three years, particularly in the industrial and agriculture sectors, where consumption has fallen by 14% and 47%, respectively. 

This fall, attributed to macroeconomic adjustments, shifting consumption patterns, and increased use of alternative energy sources such as net metering (6,035 MW), has contributed to underutilization of system assets and rising tariffs due to fixed-cost under-recoveries.

Citing past initiatives like the Industrial Support Package (2020–2023) and the Bijli Sahulat Package (2024–2025), which successfully lifted industrial sales by up to 14% and achieved monthly growth of over 10%, the government expects the new scheme to sustain productive demand while enhancing system efficiency and employment generation.

Under the approved framework:

* The package will remain effective for three years from the date of approval and will be applied on a billing-month basis.

* It will be subsidy neutral for both XW-DISCOs and K-Electric consumers.

* Positive Fuel Cost Adjustments (FCAs) will apply to incremental units, while Quarterly Tariff Adjustments (QTAs), Debt Service Surcharges (DSS), and negative FCAs will be excluded.

* If the aggregate incremental consumption of the industrial and agriculture sectors exceeds 25% above the baseline, a review mechanism will be automatically triggered to adjust the marginal cost.

* Semi-annual reviews will ensure cost-revenue alignment, and the scheme may be terminated if two consecutive upward tariff revisions become necessary.

The Ministry further directed NEPRA to incorporate the Cabinet-approved policy into the regulatory framework to facilitate implementation across the distribution network.

 The scheme’s benchmark consumption will be determined in accordance with detailed criteria to ensure fair and transparent assessment for both existing and new consumers.

The package is part of broader efforts to stabilize the national grid, enhance industrial competitiveness, and optimize utilization of Pakistan’s surplus generation capacity.

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