Less recovery, line losses: Power system braves annual loss of Rs144 bn

ISLAMABAD: The power system alone braves the annual loss of Rs144 billion just on account of less recovery of electricity bills and line losses.

More importantly, in the wake of the delayed tariff, the system also sustained loss of Rs2.75 billion too, Federal Minister for Power Division Omar Ayub told The News in an exclusive talk.

“The biggest challenge is how to cope with the issue of the capacity charges’ payments as in the current financial year 2018-19 the volume of the capacity charges have gone to staggering Rs650 billion which will be reflected in the tariff. Out of Rs650 billion, end consumers will have to pay Rs220 billion as net hydel profit.”

The payables of the power sector have surged to Rs650 billion whereas the loans borrowed by the power sector have also increased up to Rs550 billion meaning by that the circular debt has swelled to Rs1.2 trillion.

The top mandarins of the Power Division are currently in touch with the officials of Ministry of Finance on finalising the strategy on electricity tariff with an aim to address the issue of capacity charges payments and save the maximum unprivileged consumers from the expected hike in tariff and are also engaged in resolving the menace of the circular debt so that it could not emerge again. Once the plans are made to cope with the said two thorny issues, the summaries on them will be presented in the ECC meeting for approval.

The minister also highlighted the bitter fact that the former government of PML-N had competed the CoD of three RLNG power plants (Haveli Bahadur Shah, Balloki and Bhikki) of 3600MW without financial closure. He also disclosed the three projects were constructed with just 20 percent working capital which is not up to the mark. “The working capital of the three projects should have been at 50 percent.”

About the electricity theft, Mr Ayub said that the provincial government are being taken on board to initiate the result-oriented operations against the unscrupulous elements involved in electricity theft. “Our endeavour will to minimise the man-made intervention and introduce the maximum automation in the system to avoid the menace of the electricity stealing. “We are conducting the study to install the electronic metering or pre-paid meters to this effect.”

“The previous government of PML-N has generated the electricity, but did not pay the required heed to improve the transmission and distribution system so the electricity is still not available to the end consumers.”

The minister said that up till now, the system is not strong enough as it can only carry the load of 19,500MW and the existing government is striving hard to make the system strong enough to carry the load up to 22,000MW till December this year.

In high theft areas, the government is pondering over introducing the ABC cables to prevent the theft of electricity once for all through the illegal (Kunda) connections. “We are in the process to update transformers to resolve the issue of voltage problems particularly in rural areas.”