ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) recommended Rs1.04 per unit reduction in electricity tariff for government-run distribution companies back in April but the government has been delaying issuance of a notification on the matter in violation of an order of the Lahore High Court.

In the process, the government allowed the companies to squeeze Rs15 billion out of consumers, the Senate Standing Committee on Water and Power was informed on Thursday.

The power sector arrears have crossed the Rs500bn mark and circular debt stands at Rs267bn as efforts by the government to help distribution companies recover arrears from the provinces and public and private consumers have largely remained ineffective.

The meeting was presided over by Senator Nisar Mohammad Khan of the PML-N. Senior officials of the water and power ministry, National Transmission and Dispatch Company, Pakistan Electric Power Company and Wapda Foundation also attended the meeting.

Distribution companies have fleeced Rs15 billion from consumers because of delay in issuance of notification

In response to a question put by Senator Mohsin Leghari, the committee was informed by bureaucrats that the average consumer tariff approved by Nepra was Rs14 per unit but effective applicable rate was Rs11 as the government was extending a subsidy of Rs3 per unit.

During the 2013 fiscal the government provided Rs244bn subsidy to the sector.

A majority of the senators were of the opinion that had the government spent Rs250bn on improvement of the transmission and distribution system much higher savings could have been achieved through reduction in system losses.

The committee was told that average electricity generation currently stood at 15,000MW which had been increased to 16,000MW in Ramazan.

Chief of the Lahore Electric Supply Company said that several areas near Lahore were ‘no-go areas’ for his staff, resulting in alleged theft of electricity through kundas. Agriculture consumers were also not paying their bills on various grounds.

Senators asked why the government and the power companies had not been able to control theft and why Wapda had not been able to take action against the alleged thieves.

State Minister for Water and Power Abid Sher Ali told the committee that an operation in Lahore had revealed that some mills were being provided uninterrupted electricity while the people were suffering from loadshedding.

The minister said the government had decided to provide maximum electricity to the areas where bills were recovered promptly. Senator Khalida Parveen claimed that a departmental store in Islamabad was billed Rs197,000 but the bill was reduced to Rs42,000 the next month and was brought down to zero in the subsequent month. The domestic consumers, on the other hand, were being billed Rs29,000 per month.

The committee ordered an investigation into the matter.

Published in Dawn, August 8th, 2014