ISLAMABAD: Karachi Electric (KE) has approached Finance Minister Shaukat Tarin for payment of its receivables amounting to Rs 315.2 billion arguing that pending significant accumulation of TDC balance is straining the already stretched position of company’s working capital, impacting on KE’s ability to make payments for power purchases.
Of this, the amount of pending claims with Finance Ministry is Rs66.3 billion pending claims with Finance Division (others) verified TDS balances, Rs 9 billion pending with Power Division pertaining to the period July 2016 to June 2020 onward (11+4 quarters), Rs 88.8 billion pending with Power Division-other items, Rs 6.8 billion and net amount pending with Nepra pertaining to the period July 2020 to February 2022, expected to be determined in FY 2022.
According to a letter written to Finance Minister and other concerned stakeholders, KE has stated Nepra’s determinations of March 10, 2021 and December 31, 2019, in the matter of quarterly variations for the period July 2016 to March 2020 which are yet to be notified by MoE, as a result of which TDC amounting to Rs 88.8 billion (for the period July 2016 to June 2020) is stuck up.
The power utility has reiterated that claims amounting to Rs 66.3 billion, which have been verified and approved by the competent forum, are pending release. Further, verified claims amounting to Rs 9.0 billion relating to TDC balance post July 2021 and subsidy for zero rated consumers are also pending release.
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In addition, KE’s claims in respect of relief provided to zero rated industrial consumers, claims of Industrial Support Package (ISP) 2 and 3 and agricultural tube-well subsidy claims amounting to Rs 6.8 billion await verification from Power Division.
KE argues that verification of claims is required to be done within five days as per SRO 1245(0)/2007 of December 19, 2007, as amended from time to time, however, it has still not been verified.
KE has also highlighted that Nepra’s determinations for the period April 2020 onwards (impacting subsidy claims July 2020 onwards) are also pending and expected to be determined in FY 2022, after which KE will be filing its claims with MoE for the relevant period.
The delays in respect of pending matters have resulted in significant accumulation of TDC balance, straining the already stretched position of company’s working capital, impacting on KE’s ability to make payments for power purchases and/or fuel supplies as well as the execution of planned investment projects which are critical to bridge the demand-supply gap and for smooth and reliable supply of power to consumers.
“We reiterate our request to expedite the process of notification, verification and release of balances pending with MoE and also extend support in getting the amounts pending with Finance to be processed expeditiously and remaining amounts pending with NEPRA to be determined soon, so that these can be processed further,” said KE’s CFO Aamir Ghaziani in his a letter of March 10, 2022.
Copyright Business Recorder, 2022