KP asks Centre to pay Rs5.48bn power arrears

PESHAWAR: The Khyber Pakhtunkhwa government has demanded arrears of Rs5,476 million from the federal government for the electricity purchased from the Pakhtunkhwa Energy Development Organisation (Pedo).

Adviser to Chief Minister on Finance Muzzammil Aslam has sent a letter to Federal Minister for Energy and Power Division Awais Leghari, urging him to pay the outstanding amount to meet the obligations of the people of KP.

Official documents revealed that Rs2,114 million is outstanding against the Central Power Purchasing Agency (CPPA) for the electricity sale from Malakand III Hydro Power Complex (HPC). Similarly, around Rs149 million is pending on electricity sales from Daral Khwar. The relevant fora have confirmed the outstanding amounts of both projects.

The federal government has unconfirmed arrears of about Rs3,213 million. About Rs1,552 million is owed to the federal government from the sale of power from Malakand III. Nepra has issued a notification for indexation from October 2019 to September 2020. Gazette notification for power indexation is required to enable Pedo to claim the outstanding amount from the CPPA.

Similarly, Pedo exported electricity to the national grid amounting to Rs192 million from Ranolla HPS before entering into a commercial operation agreement for the period February 2020 to June 2021, however, no amount has been received.

Furthermore, Pedo exported electricity from Pehur Hydro Power Station (HPS) to Pesco from 2010 to 2019. Pesco has paid only Rs1 per unit to Pedo while the remaining amount of Rs1,232 million based on the difference is pending against the power distribution company. Pedo has exported electricity from the HPS to Pesco since November 2016, however, no amount has been paid to Pedo due to the non-signing of the energy purchase agreement and Rs196 million is outstanding against Pesco.

Similarly, Pedo has exported Rs41 million electricity to Pesco from the HPS but the amount is pending against the Disco due to non-signing of the energy purchase agreement.

Muzzammil Aslam told this correspondent that the KP government has been diligently supplying affordable electricity to the national grid, contributing significantly to the energy requirements of the country. However, the payments for electricity sold are not being adopted in sequential order. The KP adviser on finance said the sale of electricity is one of the main sources of revenue for the provincial government. “The timely and sequential payment for the electricity sold is crucial for sustaining our operations and fulfilling our obligations towards the KP people.”

He urged the federal government to take immediate action to rectify this situation and ensure that the payments for electricity sold by the KP are processed sequentially.

“By doing so we can maintain financial stability and continue to provide essential services to our citizens without disruption,” he said.