ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Tuesday hinted at revising tariff of cold storages across the country and reconnection of seasonal units within 72 hours which are paying fixed charges, without any additional charges.
Nepra held a public hearing which was convened on concerns of industrial consumers regarding financial burden in the form of fixed charges and applicability of commercial tariff to cold storages attended by dozens of cold storages representatives’ and others and Cotton Ginners Association, who presented their viewpoints on the authority’s proposals with respect to change in tariffs.
Some interveners including Arif Bilwani, Tanveer Barry and former President KCCI and representative of Pakistan Hosiery Association also participated in the discussion.
The stakeholders presented their point of views and suggestions in detail before the Authority for replacing commercial tariff for cold storages with Industrial consumers and reducing/minimizing the fixed charges.
The representatives of thousands of cold storages, in their comments urged Nepra to change their tariffs from commercial to industrial, adding that their tariff was altered by the regulator last year without hearing their viewpoint. However, Lahore High Court (LHC) had done away with the decision of the regulator. This matter is also in Supreme Court of Pakistan.
Chairman Nepra, in his remarks, stated that the country’s circular debt has already reached Rs 2.5 trillion as Rs 500 billion is being added to it per annum. He said, every consumer including industry and commercial sector has to pay for capacity which the government has added onto the tariff. He also made it clear that the burden of other consumers like cold storage will not be passed on to the already “grilled’ domestic consumers.
Member (Technical), Engr. Rafique Ahmad Shaikh, Member (Licencing), Engr. Maqsood Anwar Khan, Member (Tariff & Finance), Mather Niaz Rana and Member (Law), Amina Ahmed also raised questions for both the representatives of cold storages and seasonal units like Cotton Ginners Association.
During discussion, Director General, Consumer Affairs Division (CDA), Naweed Illahi Shaikh, raised the issue of adulteration in cold storages, which irritated the representatives of Cold Storages.
Shaikh inquired, “what about injections inserted in products stored in Cold Storages to make them sweet”? His remarks galvanized all the representatives of Cold Storages to loudly protest.
Mahar Niaz Rana, Member (Tariff and Finance) suggested to the representatives of Cold Storages to seek more concessional tariff instead of asking for industrial or agricultural tariff as this industry is of substantial importance across the world.
The Legal Counsel for Cold Storages cited references of different countries where Cold Storages are treated as industry or as an industry which contributes in the form of value addition.
However, Director General (Tariff) NEPRA Sajid Akram did not accept the arguments of Cold Storage representative saying that most cold-storage facilities are established near fruit/vegetable markets and involve no value addition. His remarks annoyed representatives of Cold Storages who hinted that if their tariff is revised upward by treating them as commercial units, they will pass it on to the consumers which will make products more expensive.
Former President KCCI Haroon Farooqi said that it is not a conventional cold storages issue, but these are temperature controlled units for different products.
Waheed Arshad who represented Pakistan Cotton Ginners Association stated that a large number of ginning units have already been closed due to shortage of cotton in the country.
However, incumbent government has focused on this and this year cotton growing area has substantially increased. He said the ginning industry only operates for a few months due to less supply of cotton and is unable to bear additional burden.
The Authority directed DG (CAD) to write a letter to Discos and KE to resume connections of seasonal units in 72 hours without any charges. However, Arif Bilwani proposed that fixed charges should be recovered not on Maximum Demand Indicator MDI) but on actual use of electricity.
Copyright Business Recorder, 2023