In recent times, the surge in electricity tariffs has left consumers grappling with exponentially rising monthly bills, causing financial insecurity and mutiny. The most recent substantial tariff hike in Pakistan, driven by IMF demands, has triggered significant public unrest, with the average consumer tariff, including taxes and surcharges, soaring to alarming heights. This price hike has further compounded the financial strain on households already wrestling with the burdens of inflation and economic challenges. In these chaotic times, innovative solutions are paramount to alleviate the financial woes of consumers. Enter the concept of Budget Billing based on Annual Electricity Consumption. Assume your electricity bill is no longer a monthly rollercoaster ride, but rather a steady, predictable expense This widespread billing approach by utility companies across the World, making waves in the energy sector, aims to offer customers a more consistent and manageable billing experience. The idea is refreshingly simple: your annual energy costs are evenly distributed across the year, resulting in a fixed, monthly payment based on your average monthly bill through retrospection analysis. But how does this pragmatic system work, and what are the benefits? In today’s rapidly evolving energy landscape, electricity providers are adopting a pragmatic approach to billing that strives to benefit consumers while ensuring a more robust revenue stream. This approach centres on closely monitoring energy consumption through smart meters, which collect data throughout the year to accurately estimate monthly energy usage. The result is a stable and predictable bill, alleviating concerns during months of higher electricity consumption. A collective approach is imperative to brainstorm solutions that enhance electricity affordability. Prepaid meters emerge as promising options, offering several advantages. They empower consumers to save money by paying for electricity upfront, providing greater control over energy usage and reducing bills, especially beneficial for those on tight budgets. These meters also foster energy conservation by offering real-time usage information, raising awareness of electricity consumption, and prompting users to adopt more energy-efficient habits. Furthermore, they grant control over energy usage, allowing consumers to plan consumption and avert unexpected high bills. Real-time meter readings enable users to monitor usage and make necessary adjustments to save costs. In essence, prepaid meters operate by prepayment for electricity, converting payments into energy units stored on the meter, facilitating electricity usage, and topping up when energy units run low to avert power shortages. Under this ingenious scheme, monthly electric bills are precisely calculated by taking a 12-month rolling average of power usage, effectively smoothing out the crests and troughs that frequently characterize traditional billing methods. This approach ensures consumers receive 12 bills per annum, each closely resembling the others, providing the comforting reassurance of a dependable electric bill like regular expenses like rent, mortgage, or car insurance. Arguably, the best thing about budget billing is that it makes your electricity costs average out to be more predictable. The worry of higher consumption on hotter days of summer to curtail many things due to a tight monthly budget remains manageable. This is a solution for typical Pakistani electricity consumers who have a tight budget and want to know exactly how much they’ll spend on electricity each month. It’s like having a reliable friend for your finances. However, this practical system remains adaptable. Regular reviews ensure that estimated consumption aligns with actual usage patterns. At year’s end, total energy consumption is tallied based on smart meter data. This system isn’t solely about fixed payments; it embodies fairness. If estimated payments consistently surpass actual consumption, consumers may receive refunds or credits. Conversely, if estimated payments consistently fall short, adjustments may be necessary to cover the difference. Crucially, this concept should extend to all consumers, ensuring individuals and households of all sizes benefit from predictable billing. Nevertheless, such a shift warrants a reevaluation of existing tariff structures, fuel inventory methods, and energy invoicing practices by CPPA(G), NEPRA, and the Ministry of Energy (Power and Petroleum Division). These changes may present challenges, necessitating financial solutions to address potential issues which will require the implementation of CTBCM. Moreover, the psychological impact of this transition must be considered. Adapting to this system may initially evoke apprehension, particularly when consumers encounter slightly higher winter bills for lower energy consumption. Effective education and communication will be vital in managing this psychological adjustment. To ensure the effectiveness of this system, security deposit mechanisms at the distribution company (DISCO) level and with landlords of rented properties may be necessary. These measures ensure the even recovery of annual electricity bills throughout the year. Considering the severe challenges faced by the country, finding an immediate approach to tackle the rising electricity bills is crucial. However, there are no quick fixes, and we must develop a comprehensive plan that encompasses short-, medium-, and long-term strategies, ensuring sustainability to avoid recurring issues. While the government of Pakistan could potentially provide financial support to electricity consumers, like BISP, the current economic instability presents formidable obstacles to this endeavour. Therefore, a collective approach is imperative to brainstorm solutions that enhance electricity affordability and facilitate the widespread adoption of solar energy. Budget Billing based on Annual Electricity Consumption emerges as a transformative solution in this context. It not only provides relief to consumers grappling with fluctuating monthly bills but also offers a fair and manageable approach to energy payments. While challenges remain, the potential benefits for consumers and the energy sector make this concept a forward-looking and viable solution. The writer is a Research Associate at the Sustainable Development Policy Institute (SDPI)