“The government has increased the average electricity tariff by more than 40% in 3 years”



ISLAMABAD: The PTI government has increased the average electricity tariff by over 40% (Rs 4.72 per unit) to Rs 16.44 against Rs 11.72 per unit over the past three years.

This was revealed by Additional Power Secretary, CAPP-G CEO Waseem Mukhtar, at a meeting of the National Assembly Standing Committee on Power, which met under the chairmanship of Ch Salik Hussain. . Mukhtar informed the Committee that Nepra had determined an increase of Rs 3.34 per unit in the base tariff, of which Rs 1.95 per unit was passed on to consumers in February of this year, but Rs 1.39 per unit is still pending. He argued that when to pass on the remaining determined increase of Rs 1.39 per unit is a political decision.

He also informed the Committee that the government owed the Independent Power Producers (IPP) 1.3 trillion rupees. And this circular energy sector debt stood at Rs 2,280 trillion as of June 30, 2021, but now reached Rs 2,320 trillion as of July 31, 2021.

The chairman of the standing committee advised the government to demand tariff reductions from PPIs, as private power generation companies have massively deceived the government. An official from the Power division informed the committee that steps had been taken to reduce the flow of circular debt, adding that the flow of circular debt was 57 billion rupees in July 2020, which fell to 44 billion rupees. Rupees in July 2021.

The issue of overcharging in Karachi was also discussed. National Assembly Member Agha Rafiullah said billions of rupees were overcharged to electricity consumers and accused Nepra of negligence claiming it was a white elephant. Responding to Afgha Rafiullah, Nepra’s vice president, Rafique Ahmad Shaikh said the regulator had previously requested a report from KE on the overbilling.

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“The Nepra adviser is investigating the issue of overcharging at Karachi Electric and other electricity distribution companies (Discos),” he said, adding that Nepra will hold a public hearing on the matter.

Officials from the Electricity Division confirmed that partial overcharging was observed during the Eid-ul-Azha and Muharram holidays.

Musadaq Ahmed Khan, Power additional secretary, said overcharging is a fact and added that the Power division will not unreasonably defend it.

Agha Rafiullah argued that the amount collected from consumers through overbilling will have to be returned to affected consumers.

He said the state should return the overcharged amount to affected consumers, and observed that it is the common man who is being punished.

According to a press release, in a report shared with the Committee, the ministry said that for the fiscal year 2020-21, the debt reached 2.28 trillion rupees in the country, mainly due to unpaid government grants that have resulted in the accumulation of debts on distribution companies.

Although there has been a 50% increase in the tariff since July 2018, the circular debt has doubled. It has been said that electricity tariffs are determined by Nepra, there is a difference in the way tariff decisions are implemented for power generation companies and end consumers. Tariffs for power generation Businesses are governed by a power purchase contract, which defines the base tariff for power generation as well as the process for subsequent adjustments. The tariff revision is thus automatically passed on to the purchase prices of electricity. Nepra only validates past claims from the electricity supplier.

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Standing Committee Chairman Chaudhry Salik Hussain observed that it is time for PPIs to manipulate and maneuver tariffs and blackmail the government. It is high time that the agreements were renegotiated with the PPIs and that consumers were relieved on electricity bills. He said circular debt resolution is necessary as it will ease supply constraints. The task is difficult because it requires that the outstanding circular debt be cleared before blocking the accumulation of circular debts. Committee members suggested that collection could be done through the revenue department and that incentives could be given on collections.

The committee also appointed a sub-committee to discuss and recommend to resolve issues faced by lawmakers in relation to Karachi Electric Comply (KE), DISCOs and GENcOs in Sindh. The composition of the committee will be as follows: (i) Lal Chand, deputy-organizer; (ii) Syed Ghulam Mustafa Shah, member of the National Assembly; (iii) Ing. Sabir Hussain Kaim Khani, Member of the National Assembly; (iv) Saira Bano, Member of the National Assembly.

The meeting was attended by Deputy Sher Akbar Khan, Ghulam Bibi Bharwana, Saif Ur Rehman, Lal Chand, Engr Sabir Hussain Kaim Khani, Saira Bano, Mian Riaz Hussain Pirzada, Zahid Akram Durrani, Syed Agha Rafiullah, Secretary, Ministry Division of Energy as well as with senior executives from relevant departments attended the meeting.

Copyright Business Recorder, 2021



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