RECORDER REPORT

ISLAMABAD: Pakistan Textile Exporters Association (PTEA) has urged the Prime Minister’s Office and Special Investment Facilitation Council (SIFC) to take immediate notice of power tariff anomalies that, it said, are undermining industrial competitiveness and threatening export growth.

The association strongly rejected the proposed Rs2.52 per kWh Fuel Charges Adjustment (FCA) for July 2026, warning that repeated electricity tariff adjustments, coupled with unresolved voltage-level anomalies, were eroding the competitiveness of export-oriented industries.

PTEA has requested the Prime Minister’s Office and SIFC to direct the Power Division and Nepra to address the B3/B4 voltage-level anomaly, rationalise industrial tariffs strictly on the basis of cost of service and develop a predictable, long-term energy framework in consultation with industry.

PTEA Patron-in-Chief Khurram Mukhtar said the export sector could not continue operating in an environment where energy costs changed almost every month through FCA, Quarterly Tariff Adjustments (QTA), base tariff revisions and other periodic adjustments.

“Export orders are negotiated months in advance at predetermined prices, while exporters have virtually no ability to pass subsequent increases in domestic energy costs on to international buyers,” he said.

He stressed that industry was not seeking a subsidy but a competitive, transparent and predictable tariff based on the actual cost of service.

“The continued silence of the Power Division over the voltage-level anomaly affecting industrial consumers is deeply concerning and has already damaged our competitiveness,” he added.

PTEA said Large Scale Manufacturing (LSM) and the export sector drive the wider industrial value chain by generating demand for thousands of SMEs, vendors, processors, transporters and service providers. An uncompetitive tariff imposed on large industrial and export units, therefore, did not remain confined to those businesses but affected the entire supply chain, employment and domestic economic activity.

The association particularly highlighted the continuing B3/B4 voltage-level tariff anomaly, arguing that higher-voltage industrial consumers impose comparatively lower costs on the distribution system, while B4 consumers do not use the DISCO distribution network.

It maintained that tariffs should appropriately reflect the actual cost of service at each voltage level instead of forcing efficient industrial consumers to absorb unrelated system costs and cross-subsidies.

PTEA warned that a larger structural problem was emerging as the government and private sector appeared to be moving in different directions on energy policy.

After decades of tariff uncertainty, cross-subsidisation, supply constraints and unpredictable adjustments, industrial consumers were increasingly seeking to reduce their dependence on the National Grid.

The association said that instead of investing available capital in new machinery, technology, productivity and export capacity, industry was being compelled to invest billions of rupees in its own generation and alternative power arrangements simply to secure predictability and reliability. “Capital that should be creating new factories, exports and employment is increasingly being diverted towards energy infrastructure. This is neither an efficient allocation of national resources nor a sustainable industrial policy,” PTEA said.

The association called for a 10-year industrial energy roadmap, developed through meaningful consultation with exporters, LSM, SMEs and other stakeholders.

The roadmap, it said, should provide visibility on tariffs, cross-subsidies, voltage-level pricing, grid charges, renewable integration and the future role of captive and distributed generation. PTEA noted that major industrial investments had payback periods extending over several years and questioned how investors could make 10-year investment decisions when there was insufficient visibility even over electricity costs for the coming months.

“Policy certainty is as important as the tariff itself,” the association stressed.