EDITORIAL: The rot behind the power bill

EDITORIAL: Circular debt has become the power sector’s mirror, reflecting not just inefficiency but deep institutional decay. The latest quarterly report shows another rise — Rs79 billion in just three months — pushing the stock to Rs1.7 trillion.

The Power Division calls it seasonal, even temporary, but a glance beneath the surface shows the same old disease: incompetence, poor recovery, and mismanagement within the distribution companies that continue to bleed the system dry.

The government insists that losses have fallen, subsidies are flowing on schedule, and recoveries are improving. Yet, the National Electric Power Regulatory Authority’s (Nepra’s) recent hearings tell a different story. In one session, the officials of Sukkur Electric Supply Company were unable to explain why detection bills worth Rs4.6 billion yielded only Rs47 million in collections.

Over 70 percent of consumers in the area were unmetered, and some detection bills were even issued for empty plots. These are not accounting errors; they are symptoms of institutional collapse. When regulators themselves express disbelief at the professional competence of Disco executives, it exposes how hollow the claim of progress really is.

Every few months, the Power Division promises a turnaround, and every few months the numbers climb higher. Circular debt is not rising because of physics or rainfall, but because of the people tasked with stopping it. Distribution companies continue to operate without proper audits, independent oversight, or credible management reform. They survive on government bailouts, accumulate losses, and feed them back into the fiscal deficit. The cycle is self-perpetuating because accountability has never been part of the design.

Circular debt is not rising because of physics or rainfall, but because of the people tasked with stopping it

Nepra’s own frustration is telling. When a member of the regulatory authority remarks that he no longer knows “which wall to bang our heads against,” it speaks to the paralysis within governance itself. Technical solutions exist — metering, automation, digital billing — but without managerial competence and ethical leadership, they serve no purpose. A sector where executives falsify recovery data or ignore defective meters cannot sustain financial stability, no matter how many policy tweaks or subsidies are announced.

What makes the crisis even more damaging is that it crowds out every other national priority. The finance ministry reported that last year’s debt clearance required massive injections of capital and commercial borrowing. That exercise temporarily lowered the headline figure, but the structural problems remained untouched. Now, as the circular debt creeps back up, it is obvious that Pakistan cannot keep buying time with borrowed money. Each rupee spent on propping up loss-making Discos is a rupee taken away from health, education, or development.

It has been said before, and it must be said again: reform cannot remain cosmetic. What the sector truly needs is professional management insulated from political interference and answerable for measurable results. The regulator must also be empowered to enforce compliance rather than merely record disappointment.

Circular debt is not the only measure of failure; it is the sum of many smaller failures — poor governance, corruption and indifference — repeated across decades. The same culture extends beyond power distribution into every sector where state ownership meets weak accountability. Pakistan’s economic deficit begins with an execution deficit, and that begins with competence.

Needless to say, if this pattern continues, the numbers will only grow larger and the excuses more creative. The government may call the quarterly rise a seasonal fluctuation, but the people who pay inflated bills for unreliable electricity see a permanent crisis. Until competence replaces complacency and accountability replaces excuses, every report will tell the same story: the rot remains and the losses deepen.

Copyright Business Recorder, 2025