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ISLAMABAD: Chairman, National Electric Power Regulatory Authority (Nepra), Tauseef H. Farooqi, said on Friday that the energy sector's circular debt has touched Rs 2.3 trillion mark.

He was commenting on power sector's issues at a meeting of Sub-Committee of National Assembly Standing Committee on Power.

Presided over by Lal Chand, MNA, the meeting was attended by Syed Ghulam Mustafa Shah, Saira Bano and Engineer Sabir Hussain Kaim Khani.

The mandate of the sub-committee was to discuss and make recommendations for resolving the issues faced by legislators with respect to KE and Discos of Sindh.

Chairman Nepra said that Discos are licencees of Nepra and when their recoveries are adversely affected, their performance worsens as well. The regulator watches Discos' performance very minutely, he said and requested Minister Energy Sindh, Imtiaz Shaikh to help Discos payments, adding that Nepra is incentivizing renewable energy projects as cost of electricity of renewable energy projects (wind and solar) has come down to cents 3.2 from cents 17 per unit.

He further stated KE's consumers were getting electricity at Rs 2.79 per unit cheaper than consumers of Discos for the last 18 months, which has now been done away with. Now KE's tariff has been brought to the level of Discos.

He said, it is itself an incentive that the government is purchasing electricity at Rs 24 per unit in some cases but allowing individuals to install their own solar system and sell it to the companies.

"If the companies are purchasing electricity from those consumers who installed their own solar systems, even at Rs 12 per unit, it is a windfall for the consumers as the government is purchasing electricity at Rs 24 per unit. If cost of electricity will not be recovered from consumers, then how the system will run as circular debt has already touched Rs 2.3 trillion. We have also to think about the country," Chairman Nepra maintained.

CEO Sepco, Ch. Muhammad Saleem, gave a detailed presentation on the performance of the company and its issues including losses and theft. He said load-shedding is done on the basis of losses, i.e., loss plus recovery, adding that if losses cross 80 per cent then 12-hour load-shedding is carried out.

He further said Nepra allowed Aggregate Technical & Commerce (AT&C) losses are over 20 per cent but the company has brought it upto 20 per cent. However, Chairman Nepra clarified that AT&C losses are government's policy and not Nepra's rules. Chairman Nepra further stated that at the global level, smart metering system exist and the decision is taken at the level of individual consumers who reckons that in case of non-payment his or her meter will be disconnected. In Pakistan the system is different as losses are divided between those consumers who pay their bills.

He further stated that whenever Discos come to Nepra for tariff revision, the regulator tries to get Discos to resolve the problem at the transformer level so that consumers are minimally disturbed.

He further stated that in the past, Nepra was extremely generous in allowing Discos extra losses due to law and order situation in the country, which has gradually reduced.

Referring to Sepco's losses of 33.1 per cent and 39.1 per cent, Chairman Nepra said that these losses are huge. Globally, losses are under 10 per cent, he pointed out.

He said Nepra has allowed 12 per cent losses under the garb of law and order issues and argued that if law and order situation exists in Kachha area of Sindh, Discos would have already unleashed load-shedding of 12 hours.

Chairman Nepra indicated that in near future, losses allowed in the name of law and order situation will be massively revised downward.

The meeting was told that in Sepco allowed losses are 29 per cent.

CEO Sepco informed the meeting that the Discos's line losses were recorded at 32.5 per cent of which 1.9 were T&G whereas T&D were 29.6 per cent. The company's distribution losses were 38.5 per cent of which 1.2 per cent were T&G and T&D were 38.6 per cent.

Sabir Hussain Kaim Khani suggested that a mechanism should be developed to waive bills of chronic defaulters on the pattern of provincial government's disputed amounts, so that they should be brought into the system. Members also shared electricity related issues with the CEOs of Sepco and Hesco. In Sepco, areas of 20 percent losses are load-shedding free.

Chairman Nepra, posed a question: when the country was facing shortage of power, AT&C losses were justified but when surplus power is available in the system and capacity charges are being paid without consuming all the available electricity did have the Discos conducted any study on doing away with AT&C losses and supplying available surplus electricity to consumers with the objective of increasing revenue?

CEO, Sepco, replied that he did such an exercise for three days by supplying uninterrupted electricity to all the consumers; the Disco's load which was 600-650 MW jumped to 950 MW, but not a single penny was received against that additional supply.

"We are ready to ensure uninterrupted supply to all the consumers across the Disco, but payment is not received against the supply," CEO added. He cited the cases of three or four villages of Dadu, where power was disconnected a couple of years ago. These villages are seeking restoration of electricity but not ready to clear previous bills, he added.

Some of the members maintained that electricity through kundas was used in public gatherings.

CEO Sepco informed the committee that the company has filed 11365 applications for FIRs during the last three years and only 91 FIRs were registered. CEO Hesco revealed that the Police attached to Discos get five per cent from recovery as incentive but do not register FIRs. The meeting was informed that the service of 10 employees have been terminated for collaborating in electricity theft.

Copyright Business Recorder, 2020