Federal Government to Give New Electricity Relief

Published On: January 22, 2026

The federal government of Pakistan has decided to provide new relief to electricity consumers through funds generated from the Capto Power Levy, originally imposed as a condition under IMF agreements. This move aims to make electricity more affordable for all categories of consumers.

How the Relief Will Work

According to government sources, the revenue collected from the Capto Power Levy will be transferred directly to electricity bills as monthly relief. The plan will be implemented in two-month intervals, providing consumers with periodic reductions in their energy costs.

The federal cabinet has already approved the use of Capto Power Levy revenue for consumer relief, and with planned increases in the levy rate, further electricity reductions are expected in the near future.

Capto Power Levy: Phased Implementation

The Capto Power Levy is being applied to private power plants in phases:

Immediate Phase (2025): 5% levy
Second Phase: 10% levy
February 2026: 15% levy
August 2026: 20% levy

All revenue collected under this law is earmarked to reduce tariffs for electricity consumers, making energy more affordable across Pakistan.

Enforcement Measures

Authorities have made it clear that non-payment of the levy will trigger action against Capto Power plants. Continuous defaults could result in disconnection of gas supply to the plant.

It is noteworthy that the federal government also increased the gas tariff for Capto Power plants from PKR 3,000 to PKR 3,500 starting February 1, 2025, following which the levy was implemented.

Coordination with IMF

Pakistan has shared the electricity relief plan using Capto Power Levy funds with the IMF, ensuring that the strategy aligns with international financial agreements while benefiting domestic electricity consumers.