Senate body approves Off-the-Grid (CPPs) Levy Bill, 2025
ISLAMABAD: Despite opposition from industries in Khyber Pakhtunkhwa, the Senate Standing Committee on Finance approved a government bill – Off-the-Grid (Captive Power Plants) Levy Bill, 2025, on Thursday.
Senator Anusha Rehman presided the meeting of the committee held here on Thursday in the Parliament House.
The bill will also be moved in the National Assembly Standing Committee on Petroleum Division on Friday (today).
Off-the-grid levy on gas-based CPPs: Govt moves copy of proposed bill in Senate
Member Committee from Khyber Pakhtunkhwa Mohsin Aziz strongly opposed the bill, labelling it 'anti-Pakistan' and stated that it would lead to the closure of industries after they were previously encouraged to install captive power plants due to a lack of electricity in the country.
The chairperson of the committee, Anusha Rehman, countered Senator Aziz's arguments, suggesting his stance appeared to oppose cheaper electricity.
Senator Aziz denied this.
Senator Rehman then noted that Senator Aziz, being online, his vote would not be counted.
Senator Manzoor Kakar expressed his support for the bill, calling it 'very good,' and Senator AnushaRehman echoed this sentiment, highlighting the prime minister's promise to reduce electricity costs.
Earlier, Petroleum Secretary Momin Agha briefed the committee on the bill, stating that its purpose is to reduce the burden of capacity utilisation and ultimately lower electricity prices for the general public. He informed the committee that a five percent levy was immediately imposed after the issuance of the ordinance, with the rate set to increase to 10 percent from July 2025, 15 percent in February 2026, and 20 percent in August 2026.
Additional Secretary Finance explained that captive power plants were initially asked to shut down, leading companies to seek legal recourse.
Consequently, the government decided to impose a levy instead of enforcing closure. He noted that out of 5,500 industrial connections, 1,100 have captive power plants, and these industries are currently operating on normal tariffs.
Petroleum Division officials informed the committee about the increasing gas prices for captive power plants, rising from Rs2,750 per MMBTU in February 2024 to Rs3,000 in June 2024 and Rs3,500 in February 2025.
On Wednesday, the government had moved a copy of the bill that provides for imposing an off the grid levy on natural gas based captive power plants in Senate session.
Deputy Prime Minister Ishaq Dar, in his additional official capacity as Leader of the House in Senate, had moved the bill on the maiden day of the Senate's 350th session. Dar moved the bill in the Senate, which was referred to the Senate Standing Committee on Finance and Revenue.
Copyright Business Recorder, 2025
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