The spiralling impact of electricity price hikes

The recent surge in electricity prices in Pakistan has ignited a complex chain reaction, threatening to destabilise the nation’s economic and social fabric. The ramifications of these tariff increases extend far beyond simple consumer discomfort, potentially undermining the very foundations of Pakistan’s power sector and broader economic stability. At the heart of this crisis lies a vicious cycle of unintended consequences. Each incremental rise in electricity tariffs sets off a cascade of effects that, paradoxically, may ultimately prove counterproductive to the goals of revenue generation and sector reform. Firstly, the sharp increase in electricity costs has led to a troubling surge in power theft. As households struggle to cope with inflated bills, in addition to substantial general inflation, many are driven to illegal connections and meter tampering.