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May 14, 2018

Karachi’s power problem


May 14, 2018

With the start of Ramazan just a few days away and the temperature still sweltering, K-Electric has been unable to end prolonged loadshedding. Even the intervention of Prime Minister Shahid Khaqan Abbasi, who last month ordered Sui Southern Gas to provide sufficient gas to K-Electric, has had no effect. This past Saturday, K-Electric CEO Tayyab Tareen was summoned by the Supreme Court where Chief Justice Saqib Nisar demanded an end to loadshedding before Ramazan. The court questioned Tareen regarding the loadshedding, calling it criminal negligence. According to the CEO, two of the 18 power production units were not working and it would take another two weeks for spare parts to arrive from abroad. While his explanation may be true, the fault still lies with K-Electric. When the utility company was privatised, the new management of K-Electric promised to overhaul the city’s crumbling power infrastructure. It has failed to do this even though K-Electric is now profitable. Faults inevitably occur in summer when demand for electricity is at its highest. Rather than using that as an excuse, K-Electric needs to explain why it hasn’t invested the necessary resources to reduce transmission and distribution losses.

Instead of increasing its output, K-Electric has followed a policy of carrying out prolonged loadshedding in areas where it says power theft and non-payment of dues is highest. In practise, this has led to severe loadshedding in low-income areas. This is unacceptable. The owners of K-Electric have spent the past year trying to sell the utility company although a bid from China ultimately fell through. What this means is that K-Electric now has even less incentive to make the necessary and expensive infrastructure investments that are required to improve power distribution. It is time to admit that the privatisation gambit has not worked. Private ownership has no incentive to work in the public interest. And intervention from the courts and city government has little effect. Karachi has become reliant on the national grid to come close to meeting its electricity requirements even though the largest city in the country needs to be self-sufficient in the production of electricity. In the 1990s, Karachi was even a net importer of electricity although those days are now long behind us. This summer will likely provide final confirmation that there is no end in sight to our electricity woes.

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