Government weighs new gas tariff slabs to expand protected consumer category

Profit reported, citing The Express Tribune, that the government is weighing new gas pricing bands to widen the protected consumer group and extend cheaper gas to more users. It aims to address debt build-up across the gas sector. The Cabinet Committee on Energy, chaired by Prime Minister Shehbaz Sharif, asked the Petroleum Division to review how protected consumers are classified.

The Petroleum Division told the meeting that evaluations by the World Bank and KPMG showed circular debt climbing steeply between 2019 and 2023, mainly because consumer gas prices stayed unchanged and RLNG was diverted to domestic users. Using a definition the IMF and World Bank accepted, the debt measures the shortfall that Sui gas companies face because of policy choices and regulatory rulings. Its charted trajectory also showed a flatter path from June 2023 through June 2026.

Other factors cited include delayed price revisions and weak power-sector recoveries, along with pending GST refunds. The division also sought Rs42 billion in RLNG dues from the power sector, Rs83 billion in GST refunds from the FBR and a Rs160 billion budget allocation to remove cross-subsidies. It warned that weak bill collection by SSGC and SNGPL has reduced the capacity of state-owned exploration firms to invest. The Finance Division will raise the gas circular debt plan with the IMF in September, and the CCOE ordered that power receivables, tax refunds and subsidy budgets be resolved.