Power outages may continue to haunt in 2018: Nepra report

ISLAMABAD: The country will continue to experience loadshedding even in 2018 due to constraints in the transmission and distribution networks despite the fact that the government will be able to erase the electricity deficit by adding generation of almost 9,000MW in the system by the-said year, unfolds the State of Industry Report 2016 which contains nine recommendations of Nepra providing the roadmap to the government to improve and reform the power sector on sustainable basis.

The year 2018 is the election year and the PML-N government had built its election campaign promising the masses that country will be loadshedding-free by end of their five year rule if they are voted, but the Nepra’s report divulging that power outages may continue to haunt the masses in 2018 on account of system constraints is enough to raise eyebrows of the top man of the government who is very touchy and sensitive to loadshedding.

The 264 pages revealing State of Industry Report 2016 prepared by Nepra of which copy is exclusively available with The News says that with prudent operation of National Power Control Centre (NPCC), loadshedding in May, June and July can be minimised in 2017 whereas in 2018, no loadshedding is expected in the system due to shortage in power generation, however, power shortages may be experienced due to constraints in the transmission and distribution networks. Apart from the system constraints, the actual line losses stood in 2015-16 at 17.95 percent against the 15.23 percent losses allowed in the electricity tariff showing that the gap of about 2.72 percent still exists. This means that the DISCOS braved mammoth loss of Rs20.72 billion just in the head of line losses in 2015-16.And in case of K-Electric, the losses have remained above 25%; however it has maintained a downward trend in T&D losses throughout. During 2015-16, K-EL reduced its T&D losses by 1.23% as compared to its 2014-15 losses.

Apart from T&D losses, the low recovery ratio of DISCOs has emerged as a challenge for the power sector to thrive. And just because of the less recovery the power sector sustained loss of Rs53 billion in 2015-16. The Authority assesses a recovery target of 100% while setting the consumer-end tariff for DISCOs, however the actual reported recovery ratio of DISCOs, remained around 94% for the FY 2015-16. The impact of lesser recoveries viz-a-viz Authority’s set target, has resulted in an annual shortfall of around Rs53 billion. Non-recovering the billed amount is due to poor performance of some DISCOs which has resulted in total receivables of DISCOs amounting to Rs638 billion as on June 30, 2016.

The report also highlighted the endeavours of the government in increasing the power supply and mentioned the importance of the power projects under CPEC umbrella but at the same time expressed fears over the failure of the government in upgrading the transmission and distribution system arguing it may cause power outages even in 2018 despite the availability of electricity in abundance.

The ministry of water and power, however, said the government is very much on toes as far as the up-gradation of the transmission and distribution is concerned. The ministry also claimed that it will upgrade the system up to the mark by December 2017.

However, the report mentions the alarming fact that the overloading in DISCOs’ system coupled with other constraints on NTDC (National Transmission Distribution Company) system has been resulting in power supply constraints. The regulator in the report has observed that during the high demand months, due to constraints in DISCOs and NTDC network, the electricity to the tune of more than 3000 MW on a day could not be withdrawn by DISCOs.

DISCOs (Electric Power Distribution Companies) are emphasised to deliver a reliable electric power to end consumers while maintaining performance standards as set by Nepra. Three main components are monitored by the regulator for gauging the performance of DISCOs as constraints in these components would limit DISCOs’ ability to draw power from the extra high voltage system of NTDC which will result in power supply cuts for the end consumers.

Highlighting the system constraints, it mentioned the overloading position of 11 kv feeders in DISCOs. “Except for IESCO where overloading of 11 kv feeders is noted to be around 12 percent, other DISCOs have more than 20 percent overloaded feeders. PESCO and MEPCO have more than 40 percent feeders overloaded, whereas in Lesco about 58 percent feeders are loaded above 80 percent and on countrywide basis 32 percent of 11kv feeders have been noted to be loaded above the acceptable level”.

The problems of the system constraints have increased because of the fact that DISCOs remained unable to make investments to upgrade the distribution systems. 

In 2013-14, DISCOs were allowed to invest Rs52.006 billion to improve the system, but they just spent Rs43.88 billion showing that it failed to spend the amount of Rs8.124 billion. And in 2014-15, DISCOs were permitted to invest Rs57.4 billion, but they spent Rs41.8 billion showing inability to spend the huge amount of Rs15.57 billion. And in 2015-16, the distribution companies were allowed by Nepra to invest Rs65.034 billion, but the DISCOs just managed to spend a meagre amount of Rs718.6 million. 

Mentioning about the performance of public sector thermal power plants, the report said (GENCOs) have been found to be lacking in terms of all Key Performance Indicators (KPI) for the past many years. The report also unfolded the irritating fact that a number of power generation units have outlived their useful lives, operating at lower than their rated capacities and inferior efficiencies. 

These power plants have not only poor operational results, the workforce which is already on the higher side on per MW basis remained idle due to their closure and non-operation; contributing towards higher cost of generation. 

In order not to pass on imprudent costs to consumers, the Authority had earlier advised all the GENCOs to carry out performance tests, so that degradation in their operational capabilities, efficiencies and administrative factors like manpower and overhauling and maintenance schedules are set afresh.