The Power Division and K-Electric remain at odds over the payment of Tariff Differential Subsidy (TDS), with the utility demanding disbursements based on original tariff determinations, while the Power Division maintains that payments will be made under revised determinations issued by the National Electric Power Regulatory Authority (NEPRA), Business Recorder reported.
The disagreement has led to sustained correspondence between the two sides, with each citing court orders and regulatory provisions to support its position. K-Electric has linked its stance to interim orders issued by the Sindh High Court (SHC), arguing that these restrain the enforcement of revised tariff determinations currently under judicial review.
In a recent communication to the Power Division, K-Electric said legal counsel representing the utility before the SHC was of the view that attempts to process TDS under revised tariffs could expose respondents, including government departments, to contempt proceedings. The utility reiterated that its provisional TDS claims should be processed under original tariff determinations until the court decides the matter.
K-Electric cited pending constitutional petitions and SHC interim orders dated November 4, 2025, arguing that interim relief must be read in the context of injunction applications and bars any direct or indirect enforcement of the revised tariffs. It maintained that withholding provisional claims based on original tariffs effectively amounts to implementing the revised determinations, which it says is not permitted while the matter is sub judice.
According to the BR report, the power utility also stated that even the agent bank, Habib Bank Limited, operating under the Master Collection Agreement, is bound by the SHC’s interim orders and cannot process payments linked to the revised tariffs.
Referring to provisions of the Tariff Differential Subsidy Agreement, K-Electric argued that Clause 2.1 requires provisional claims to be filed on the basis of the preceding tariff where a court issues restraining orders against a challenged determination. The utility maintained that the SHC’s interim orders qualify as restraining orders under the agreement.
K-Electric further contended that under Clause 2.6 of the agreement, preparation of the TDS balance report rests solely with the utility, and that the Ministry of Energy lacks authority to unilaterally revise or amend such reports, particularly where revisions rely on tariffs under judicial restraint.
The utility has requested the Power Division to process and release its provisional TDS claims in line with original tariff determinations, while reserving its legal rights in the event of non-compliance.