The Punjab cabinet on Monday sanctioned the Electricity Duty Rules 2026, establishing a revamped taxation system targeting private power generation, including generators and solar energy setups, while exempting household consumers from the levy.
Under the updated regulations, private generators and solar power systems exceeding 500 kVA capacity will now be subject to electricity duty. Industrial and commercial consumers will face a charge of 4 paisa per unit of electricity consumed.
The provincial government anticipates generating approximately Rs306 million annually from this new tax framework. Officials have identified 1,177 industrial and commercial sites that will be impacted by the revised rules.
Notably, domestic electricity users remain fully exempt from any electricity duty under the new provisions.
The rules also enhance the enforcement authority of electric inspectors, granting them powers to seal power generation facilities, audit records of private plants, and ensure compliance through recovery actions under the Land Revenue Act.
Furthermore, private power producers will be mandated to register their generation systems, including solar installations. Industrial and commercial self-generation units must install separate energy meters to monitor consumption accurately.
Monthly reporting through returns and maintenance of log books will become compulsory. Failure to comply with these requirements will result in late payment surcharges ranging from 10 to 15 percent. Additionally, inaccurate reporting may lead to penalties and potential suspension of electricity generation operations.
In a significant development, the provincial government has repealed the previous Electricity Duty Rules of 2012, replacing them with the newly approved Electricity Duty Rules 2026 to better regulate and tax private power generation within Punjab.
