Experts ask govt to scrapuniform electricity tariff policy

LAHORE: A group of experts on Monday urged to bring down the cost of power production to reduce tariff and end the uniform tariff policy to make the distribution companies efficient and more responsible for managing losses in their respective territories.

They were speaking at a discussion ‘Increase in power tariffs - impact on consumers affordability, DISOCS recoveries and circular debt’, organised by the Lahore Economic Journalists Association (LEJA). They suggested to appoint more professionals in Discos, increase power generation from indigenous resources and renewables and separate the financial recoveries like taxes and fee of other departments form electricity bills. The good power paying consumers should be protected and power thieves penalised.

LEJA President Muhammad Sudhir Ch, referring to the Institute of Policy Studies (IPS) study, ‘impact of rising electricity prices on consumer’s behaviour’, said paying power of consumers were affected by the increased tariff, which resulted in substantial hit to recoveries and adversely affected the power sector circular debt.

Chairman LESCO Board Hafiz Muhammad Numan endorsing the point of view said that Discos implement the tariff given by the government of Pakistan through NEPRA. The government increased the power tariff under the IMF pressure, besides adding the capacity charges being paid to the IPPs, which have played a major role in tariff hike. However, the company is still getting 30,000 fresh connection applications every month since electricity is the basic need of life.

Numan said that LESCO was on top in the ongoing power recovery campaign launched by the government. The company has planned to establish its own police, and is requesting the Punjab government to link any of the property transactions with LESCO NOC. “During the last 11 months the LESCO response time has been down to one hour from three hours,” he added.

Energy Expert (former MD PEPCO) Tahir Basharat Cheema said Kasur topped power theft list in the LESCO region, owing over Rs20 billion. The capacity payment charges issues could be resolved if the government ends forced load management.

There is still more than 5,000 megawatt demand in the system, which could be immediately supplied from the available resources. Cheema suggested ended the uniform tariff policy so the discos work efficiently, and those performing below par try to catch up to improve their performance. Further, he asked to end the load of all taxes, and the fee which is almost 30 percent of the total bill of almost each consumer.

About the privatisation of the power sector or dispensing it to the provincial governments to end the menace of circular debt, he said the government is working on contracts to handover discos to the private sector for 20-25 years alongside its own regulations since handing over to the provinces is unworkable.

LESCO CEO Shahid Haider said that LESCO registered 22,683 FIRs against power theft and recovered Rs600 million against the demand of Rs1.91 billion. Besides, LESCO has taken actions against 70 employees involved in power theft, with more than a dozen already terminated from services.

K-Electric Director Communications Imran Rana said during the last 10 months, KE conducted over 14,000 kunda raids and removed more than 130,000 kilograms of illegal kunda connections in the distribution network.

According to the World Bank reports, more than 50 percent of Karachi is unplanned, which made it challenging to provide smooth power supplies. The KE registered more than 750 FIRs against 74,000 power theft cases stealing over 70 million units, while recovering more than Rs60 million.

The KE stood as the most improved distribution company with Rs474 billion investment in the company’s value chain since privatisation. Resultantly, the T&D losses have been reduced from 38 percent in 2015 to 15.3 percent, even below the NEPRA targets.

KE’s investment plan 2024-2030 with prospective investment of Rs484 billion was submitted to NEPRA. KE plans to increase the share of renewables to 30 percent, add 30 percent more customers and further reduce power outages by 30 percent by 2030, Imran added.

Lahore Chamber of Commerce President Kashif Anwar stressed the need of using renewable resources of power generation, including construction of Kalabagh Dam and indigenous solar power generation.

He said Pakistan needs a charter of economy before the election so the country is put on the growth path. He said power theft was not possible without the connivance of the distribution companies’ staff, which made accountability crucial.