The government is considering introducing additional gas tariff slabs to help more household consumers qualify for protected rates and receive gas at lower prices.
The proposal follows a directive from the Cabinet Committee on Energy (CCOE), which has asked the Ministry of Energy’s Petroleum Division to review the existing classification of protected gas consumers.
The proposed changes could expand the number of households falling within the protected category. This would allow more consumers to benefit from comparatively lower gas prices under the government’s tariff structure.
The Petroleum Division has been directed to examine whether the current consumer categories provide a rational and effective basis for determining protected consumers. The review is expected to focus on creating a more appropriate classification system.
The issue is also linked to the continuing financial challenges facing Pakistan’s gas sector. The government has been working to address the sector’s circular debt while balancing the impact of gas prices on household consumers.
Assessments by the World Bank and KPMG have highlighted a significant increase in gas-sector circular debt between 2019 and 2023. The rise has been associated with several factors, including delays in increasing gas prices and the diversion of regasified liquefied natural gas (RLNG) toward domestic consumers.
The growing financial gap in the gas sector has remained a major challenge for policymakers. Gas pricing decisions have to take into account both the cost of supplying the fuel and the financial burden placed on households.
Under the proposed approach, additional tariff slabs could provide the government with more flexibility when determining which consumers qualify for protected rates. Instead of relying on a limited number of categories, a broader classification could potentially cover more household users.
However, any changes to the tariff structure would need to balance consumer relief with the financial sustainability of the gas sector. Lower rates for additional consumers could provide immediate relief to households, while the government would also need to consider the resulting impact on sector revenues and circular debt.
The CCOE’s direction therefore places the Petroleum Division at the centre of the next stage of the review. Officials will have to assess the existing system and determine whether additional slabs can be introduced without creating further financial pressure on the gas sector.
For domestic consumers, the potential expansion of the protected category could become important if the government moves forward with the proposal. More households could become eligible for lower gas rates depending on the criteria eventually approved.
The development comes at a time when energy prices remain an important issue for Pakistani households. Gas bills can vary significantly according to consumption levels and the tariff category assigned to individual consumers.
The government’s latest move reflects an effort to find a balance between protecting household consumers and addressing the structural financial problems affecting the gas sector.
Further details about the proposed tariff slabs, eligibility criteria and rates are expected to become clearer after the Petroleum Division completes its review and submits its recommendations.
