KE may be forced to increase loadshedding

KARACHI: The K-Electric has alerted the Chief Minister Sindh Syed Murad Ali Shah about the increase in the loadshedding, if the provincial government did not resolve the issues regarding supply of Regassified Liquefied Natural Gas (RLNG) and its price differential claims.

The KE said five hours could further be added in the current loadshedding period, which are around six to nine hours. In a letter written by the KE’s CEO to the CM Sindh, Syed Moonis Abdullah Alvi brought the issue of the power utility’s Tariff Differential Subsidy (TDS) claims which, according to the letter, have ballooned to a critical point. “Even after adjusting KE’s payments to CPPA/NTDC, the utility’s net receivables due to the TDS claims stand at least Rs25 billion,” the letter said. The power utility requested the provincial government to support in releasing their payments on urgent basis.

The letter mentioned how these payments are crucial towards the procurement of fuel from Pakistan State Oil (PSO) and Sui Southern Gas Company (SSGC), "which power KE’s generation capacity.” In addition to this, there is an increase in the base tariff due to unavailability of indigenous natural gas that is supplied by SSGC to the power utility, "which is being substituted by very expensive imported RNLG. Furthermore, the prices of furnace oil have doubled in a year. KE is unable to sustain this widening gap without settlement of dues.”

The power utility said that if the current situation continued, they won’t be able to pay bills to the SSGC, which could result in disconnection of gas supply to the KE, and could cause a sharp curtailment of power generation by the KE, which would be approximately of 500MW. “This translates into incremental loadshedding of five hours across the city, over and above the existing regime of 6 to 9 hours,” the letter said, adding that it could have a serious impact on economic and industrial activity, and potential to create a law and order situation in the city.

The letter further mentioned how the SSGC has been supplying the RLNG to the KE instead of natural gas, which was against the orders of the Sindh High Court. The RLNG, according to the power utility, is five times more expensive than local gas.

“An immediate shift to indigenous gas would ease the burden on both KE and eventually on the customer,” the letter said. The CEO KE sought the CM Sindh's help in release of its TDS amount to secure fuel supply to the city. It also requested the CM Sindh to play his role to give directives to the SSGC and to provide the power utility natural gas instead of the RLNG as per the court’s decision.