LCCI concerned at swelling power sector circular debt

RECORDER REPORT

LAHORE: The Lahore Chamber of Commerce and Industry (LCCI) has expressed grave concern over fast rising power sector circular debt that has touched the alarming levels and urged the government to ensure availability of sufficient resources to forestall the unprecedented outages.

LCCI President Irfan Qaiser Sheikh in a statement on Saturday said that if the government failed to take immediate measures the power sector was likely to choke up due to heavy outstanding dues.

He said the Ministry of Finance and the Ministry of Water and Power should take urgent steps for making payments to cope with the fast deteriorating energy situation.

Irfan Qaiser Sheikh said the LCCI had been calling for a long time now for much needed reforms in the power sector to control pilferage, line losses and to stop corrupt practices.

He said that people in general and the industry in particular continued to suffer long blackouts in spite of almost doubling the price of electricity in the last four years.

He said the government in 2008, pledged to revamp the power sector and end electricity shortages. Since, it has raised electricity price by more than 85 percent to eliminate subsidies but failed to implement reforms to make the power sector efficient.

The LCCI President said that the energy situation would have been quite satisfactory today, had the government eliminated production, transmission and distribution losses; checked electricity theft and recovered the outstanding electricity dues.

He said there was a need to evolve an altogether new policy to attract private sector investment in electricity generation to overcome the gap between the demand for electricity and the supply.

He said the main reason for the growing electricity shortfall was not just the increase in demand but also the declining capacity to produce electricity because of its inconsistent policies.

Irfan Qaiser Sheikh said the ultimate solution to the ongoing energy crisis lied in the construction of mega water reservoirs or tapping the coal potential the country owned.

He said the government should utilise all available resources to win consensus over Kalabagh Dam that had the capacity of cheapest electricity to the masses.

He said that a further delay in gathering a consensus from all stakeholders on the construction of unduly politicized Kalabagh Dam would cost the country and its coming generations very dearly.

He said unlike Pakistan, India was constructing dams at every possible site. “It has left us decades behind and coming time does not promise any good thing either.”

He said everyone knew that the existing dams were constantly silting up leaving ever decreasing capacity to store water. The construction of Kalabagh dam along with other new dams was desperately needed to store adequate water.

According to a conservative estimate about 30 million acre feet of water was being wasted into the sea because the country had no big water reservoirs to store it.

More importantly, as a result of melting of glaciers due to global warming, a sword of Damocles remains hanging over our heads in the shape of floods. An opinion gained widespread support across the country that the losses of recent floods in Pakistan which are estimated to be more than 45 billion dollars could have been reduced if big dams and water reservoirs were in place.

He said that another significant aspect connected with the construction of Kalabagh Dam was the surety of sufficient amount of electricity at comparatively much cheaper price. The country’s dependence on power generated through thermal sources is costing us way too much causing to face insurmountable challenges to remain competitive both in national and international markets.

Another significant aspect connected with the construction of Kalabagh Dam is the surety of sufficient amount of greener and cheaper electricity. Electricity generation through thermal sources was estimated to cost almost Rs 16 per unit whereas the same could be produced at Rs 2.5 to Rs 3 through Hydel, he added.