Islamabad: (RightNow) Reforms in the energy sector are accelerating to comply with IMF conditions. Preparations are underway to end the current slab and cross-subsidy system for gas and electricity consumers.

Sources reveal that a new electricity subsidy system will be implemented from January 2027, while a new gas subsidy system will be introduced from July 1, 2027. Subsidies will be limited to deserving and low-income consumers only.

The Power Division, with the World Bank’s assistance, has started working on a socio-economic registry of deserving consumers. The target is to complete the registration by November. After verification, the data will be linked to the Benazir Income Support Program records.

Preparations are in place to end the tariff differential subsidy and cross-subsidy system in electricity by January 2027. Gas consumers will be linked to the socio-economic registry from July 1, 2027. DISCOs have filed applications for basic tariff adjustments.

It is noteworthy that the subsidy system change is planned to reduce the pressure of circular debt in the energy sector. The IMF has been informed about preparations related to the privatization and reforms of electricity distribution companies.