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KARACHI: K-Electric's Chief Executive Officer (CEO) Syed Moonis Abdullah Alvi on Monday said any 'knee-jerk' modification by National Electric Power Regulatory Authority (Nepra) in distribution license of KE - the sole vertically integrated power utility of the country-would badly jeopardize its medium and long-term investment plans.

Addressing media persons at KE head office, Alvi said any modification/changes [in its distribution license] would be considered as a breach of agreement with the government of Pakistan. "We would be left with no option but to approach the Supreme Court (SC) against the move," he said adding the Nepra appellate tribunal has not been constituted yet despite the apex's court directives.

Alvi said Nepra has called a public hearing in the matter of Authority Proposed Modification (APM) in the Distribution License of KE under Section-26 of the NEPRA Act in Karachi on September 21.The authority has invited stakeholders, including the general public to participate in the hearing to submit their comments on the matter.

KE believes that the proposed move of the regulator is not in public interest at large, rather it is against the public interest and the criteria provided under Section 26 of the Nepra Act, 1997.

The proposed modifications, Alvi said, would have an adverse and devastating effect on the performance of the KE, on the service being provided to consumers and on the costs and tariffs of the licencee.

"If the government really wants a competitive environment within the power sector, it should ensure a level playing field for all market players, and come up with similar standards for all power distribution companies he argued."

As per the agreement with GoP, Alvi said KE will have exclusivity (monopoly) in distribution of power within its service area till 2023, and the power company would be regulated by the government. He said the change in distribution license 3 years before the contract comes to an end would jeopardize its medium and long-term investment plans.

KE has already planned capacity additions across the value chain based on its distribution exclusivity and taking into account the existing and projected future demand in its service area. While sharing the medium-term actions agreed with the government he said the National Transmission and Dispatch Company (NTDC) will evaluate rehabilitation of Jamshoro- KDA Circuits to provide an additional 300MW of power to KE system before summer 2021. With the first unit of Bin Qasim Power Station-III (BQPS III) coming online, total addition will be of 550MW by summer 2021, and by summer 2022, an additional 800MW as 400MW through construction of new 220Kv Dhabeji Grid, and 400MW through 2nd unit of BQPS III would be added to the system. Similarly, by summer 2023, Alvi said, further 800MW would be added through construction of a new 500KV grid to evacuate power from K2/K3. In addition, K-Electric will be investing in interconnection infrastructure with a view to evacuating additional power from the national grid on priority.

In this regard, the power utility has already sought necessary regulatory and governmental approvals, and following the timely receipt of the same, K-Electric will be in a position of materialize the large-scale power projects that would move Karachi into a power surplus position, Alvi said.

In response to a query, he said Shanghai Electric Power (SEP) has renewed its intention in June to buy KE. However, the National Security Clarence is still awaited in this regard.

Alvi feared that the proposed modification, if carried out, would cause further delay in the transaction process of KE.

Alvi said KE experienced a cyber attack some days back however critical customer services, including bill payment solutions are intact and fully functional. "Some internal data, we are recreating," he added.

Copyright Business Recorder, 2020

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