BAFL 46.54 Decreased By ▼ -0.21 (-0.45%)
BIPL 21.04 Increased By ▲ 0.68 (3.34%)
BOP 5.54 Increased By ▲ 0.23 (4.33%)
CNERGY 4.85 No Change ▼ 0.00 (0%)
DFML 18.82 Increased By ▲ 1.67 (9.74%)
DGKC 80.50 Increased By ▲ 1.65 (2.09%)
FABL 30.95 Increased By ▲ 1.71 (5.85%)
FCCL 20.49 Increased By ▲ 0.14 (0.69%)
FFL 9.59 Decreased By ▼ -0.07 (-0.72%)
GGL 13.94 Increased By ▲ 1.19 (9.33%)
HBL 116.96 Increased By ▲ 2.68 (2.35%)
HUBC 123.62 Decreased By ▼ -0.18 (-0.15%)
HUMNL 7.98 Increased By ▲ 0.40 (5.28%)
KEL 3.52 Increased By ▲ 0.19 (5.71%)
LOTCHEM 28.59 Increased By ▲ 0.34 (1.2%)
MLCF 42.10 Increased By ▲ 0.10 (0.24%)
OGDC 123.10 Increased By ▲ 8.99 (7.88%)
PAEL 18.82 Decreased By ▼ -0.03 (-0.16%)
PIBTL 5.71 Increased By ▲ 0.11 (1.96%)
PIOC 114.50 Increased By ▲ 0.60 (0.53%)
PPL 110.98 Increased By ▲ 11.52 (11.58%)
PRL 27.52 Increased By ▲ 0.76 (2.84%)
SILK 1.08 Decreased By ▼ -0.01 (-0.92%)
SNGP 70.09 Increased By ▲ 2.69 (3.99%)
SSGC 13.18 Increased By ▲ 0.58 (4.6%)
TELE 8.81 Increased By ▲ 0.26 (3.04%)
TPLP 13.65 Increased By ▲ 0.35 (2.63%)
TRG 91.94 Increased By ▲ 6.25 (7.29%)
UNITY 26.81 Increased By ▲ 0.34 (1.28%)
WTL 1.57 Decreased By ▼ -0.01 (-0.63%)
BR100 6,544 Increased By 101.5 (1.58%)
BR30 23,210 Increased By 429.3 (1.88%)
KSE100 63,918 Increased By 961.7 (1.53%)
KSE30 21,352 Increased By 348.1 (1.66%)

ISLAMABAD: The government Wednesday said that if any sector will sink the country’s economy it is the power sector as the volume of subsidy is 12 percent of total budget, which is higher than defence budget and annual development budget.

This was stated by Secretary Power, Rashid Mahmood Langrial while giving a detailed briefing to the National Assembly Standing Committee on Power presided over by Sardar Riaz Muhammad Khan Mazari on performance of power sector, its financial position, and issues.

He presented a very bleak position of power sector, saying that power sector lost Rs 1.072 trillion in just one year over and above earmarked subsidy adding that the sector is the highest loss-making government institution.

“If any sector will sink the country’s economy, it is the power sector as it lost Rs 1.072 trillion in one year and the sector is functional due to Finance Ministry’s extraordinary support. We don’t spend as much on defense as we do on subsidies,” he added.

Secretary Power said that circular debt stood at Rs 2.253 trillion as of June 30, 2022 of which payables to power producers were Rs 1.351 trillion whereas Gencos payables to fuel suppliers were Rs 101 billion.

Plea seeking FCA mechanism review rejected by Nepra

He said main reason for the economic pressure faced by the country is the problems in the power sector, saying that privatisation of power companies will not bring profit but efficiency will definitely improve.

He said, it is the government’s decision to keep tariff of Rs 5 per unit for 40 percent of domestic consumers through subsidy which, according to him, is not sustainable. Currently, national average tariff is Rs 22.48 per unit. The average tariff for domestic consumers is Rs 19.53 per unit, commercial Rs 29.68 per unit, general services Rs 28.90 per unit, industrial Rs 25.87 per unit, bulk supply Rs 28.44 per unit, agriculture Rs 15.96 per unit others (AJK, SL, RC) Rs 27.18 per unit. The Discos overall recovery is 90 per cent.

Secretary Power also shared reasons for the increase in generation cost which includes higher prices of imported fuels and capacity payment to power producers, adding that increase in fuel prices also increases the share of subsidy. He argued that hydel generation production has increased due to rains.

Last month, the price of LNG spot cargo was $40 per mmbtu and if the government would have procured LNG at the rate, the cost of electricity could be Rs 70 per unit. The Petroleum Division decided not to buy such expensive LNG.

Rashid Langrial informed the Committee that there are 36.595 million electricity consumers in the entire country and of these, 31.5 million are domestic consumers. He said, 11.2 million domestic consumers are eligible for subsidies.

Last year, Rs 2.892 trillion were spent on electricity production whereas the government received only Rs 1.535 trillion, showing a shortfall Rs 1.351 trillion.

The Standing Committee postponed the Electricity Generation, Transmission and Distribution Amendment Bill 2021 till the next meeting, after a couple of members from Sindh proposed amendments to the Bill.

The Committee passed Private Power & Infrastructure Board (amendment) Bill, 2022 unanimously with a minor amendment which will merge both PPIB and AEDB.

During discussion on this Bill, Secretary Power acknowledged that the contract of Managing Director PPIB, Shah Jahan Mirza has expired but he has been brought to the meeting for assistance, adding that Power Division has sent summary for extension in contract for another six months.

The issues like shortage of meters, bursting of power transformers and less recovery in Discos also came under discussion.

According to official statement, Secretary, Power Division informed the Committee that in future no power generation plant would be installed which generates electricity on fuel. The Committee expressed its dissatisfaction regarding un-announced load shedding especially during Eid days.

While discussing the Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Bill, 2021 (Government Bill), the Secretary, Power Division informed the Committee that the provincial rotation clause creates hurdles in the appointment of Members Electricity and Finance. The Committee recommended that after one month, the vacant post should be fulfilled on open merit to make the appellate tribunal functional.

The committee deferred the matter raised by Muhammad Anwar, MNA regarding the worst load shedding in District Lakki Marwat, the starred question no. 49 moved by Syed Mehmood Shah, MNA and Starred Question No. 38 moved by Mohsin Dawar, MNA till its next meeting.

MNAs Ch. Khalid Javed, Sardar Muhammad Arfan Dogar, Syed Ghulam Mustafa Shah, Engr. Sabir Hussain Qaimkhani, Saira Bano, Dr Muhammad Afzal Khan Dhandla, Muhammad Abdul Ghafar Wattoo, Makhdoom Syed Sami-ul-Hussain Gillani, Mir Khan Muhammad Jamali and senior officers/officials from the Ministry of Power Division attended the meeting.

Copyright Business Recorder, 2022


Comments are closed.

arif Aug 04, 2022 07:18am
The secretary dis not say how much free electricity used by power companies emoyees is responsible for the losses or how much free petrol/diesel to WAPDA officers is provided. And why he did not say how much of the outstanding losses are due to the crimes of mega corruption which were allegedly committed by just retired Head of WAPDA?
thumb_up Recommended (0)
Muhammad Ali Raza Aug 04, 2022 10:04am
Policy to shift from Hydel to Fossil Fuel based power generation happened in Zia Ul Haq era & no government except PTI tried to turn away from it. Pakistan has technically defaulted already when not paying off circular debt. Rip self destruction policies of 40 years. In Pakistan,projects were never made on open bids basis by design to reap illegal commissions. Nation will face the music for next 25 years of world's most expensive electricity.
thumb_up Recommended (0)
Khalid Arain Aug 04, 2022 03:21pm
So why not go for Run of River projects to generate cheap electricity or Solar, Wind, Local coal etc. Why capacity payments to Power companies are being allowed i.e. payment despite the face they are not generating the electricity.
thumb_up Recommended (0)

Briefing to NA panel: Govt paints pretty grim picture of power sector

Another day, another high: KSE-100 gains 1.5% to close near 64,000

Imran free to contest upcoming elections: caretaker PM Kakar

ADB approves $659mn project financing to support Pakistan

At least three dead in fire incident at Karachi’s Ayesha Manzil: mayor

Inter-bank: rupee registers 7th consecutive gain against US dollar

Open market: rupee’s strengthening round continues against US dollar

Security forces kill terrorist in KP’s DI Khan: ISPR

Experts see status quo in last monetary policy announcement of 2023

Despite Gaza death toll soaring, US unlikely to rethink weapons supplies to Israel

Nawaz Sharif meets PML-Q’s Chaudhry Shujaat to discuss electoral alliance