Govt Confirms Subsidized Electricity For BISP Families Under IMF Agreement
The government recently announced a crucial component of the relief package: subsidized and free electricity for eligible families registered under the Benazir Income Support Program. This new initiative will benefit families who have completed their NSER survey and meet the requirements for the Benazir Kafalat Program.
The government will implement a new power subsidy program in January 2027 to address the inefficiencies of the current system.
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Subsidized Electricity for BISP 9.3M Beneficiaries
As per Business Recorder, referencing sources from the Finance Ministry, the national government has committed to linking energy subsidies with the Benazir Income Support Fund (BISP), ensuring that financial aid is allocated solely to deserving recipients.
As part of broader efforts to harmonize Pakistan’s energy regulations with global agreements, including those made to the IMF and domestic environmental targets, this alteration is being introduced. The goal of the government is to address the shortcomings in the existing electricity subsidy program by implementing a fresh approach by January 2027.
Government Plans to Replace Tariff Subsidy System
The Finance Ministry has meticulously prepared a transition plan, which includes identifying and verifying eligible customers by January 2026. This will be followed in mid-2026 with the establishment of a reimbursement mechanism through financial institutions and the determination of specific eligibility criteria.
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The current system of tariff differences and cross-subsidies will be replaced by a streamlined structure that utilizes BISP to specifically target eligible customers. This approach aims to address the issue of subsidies being distributed to higher-income households, resulting in excessive consumption, energy wastage, and potential instability in the electricity industry.
Public Communication Drive June 2025
A public educational campaign will be initiated in June 2025 to inform individuals about the updated subsidy system.
According to the paper, the government is aiming to improve its gas subsidy program, which has caused both inefficiencies and distortions. After a thorough review, decisions are expected to be made by June 2026 regarding the feasibility of implementing a similar targeting system for gas subsidies as part of the broader reform agenda.
Who Will Qualify for Subsidized Electricity in 2025?
Starting next year, discounted electricity will be exclusively available to households registered with the Benazir Income Support Program (BISP). The government’s aim is to eliminate the current tariff distinction and cross-subsidy approach and instead, provide targeted assistance through BISP to only those in need of financial aid.
Energy Efficiency Rules for Appliances to Become Mandatory by 2027
In addition to reforming subsidies, the government is also focused on enhancing energy efficiency. This includes implementing the newly established Minimum Energy Performance Standards (MEPS) for consumer appliances. By June 2027, a range of devices such as fans, LEDs, refrigerators, air conditioners, and motors is expected to meet these standards.
The Public Procurement Regulatory Authority will also ensure that all government purchases of these appliances comply with MEPS guidelines by December 2025.
Conclusion
The government’s proposal to tie electricity subsidies to BISP strives to guarantee that relief is provided only to deserving, low-income households. This change from the current ineffective system to a more focused one, while also implementing stricter energy efficiency regulations, demonstrates Pakistan’s commitment towards equitable energy distribution and sustainable progress, as per the IMF obligations.