ISLAMABAD: A four-member independent inquiry committee on ‘Abject Failure — Illegal Overbilling’ confirmed the power regulator’s overcharging allegations against all the distribution companies (Discos) across the country but absolved them of ‘deliberate and mala fide’ fleecing while shifting some blame on to the then PDM-led coalition government’s decision-making.

All the members of the inquiry committee who have either worked with or still working under the Power Division in different capacities.

In a 37-page report, the committee led by former federal secretary Irfan Ali also blamed the National Electric Power Regulatory Authority (Nepra) for jumping the gun with hasty publication of such ‘extreme allegations’ while simultaneously commending with consensus the regulator’s ‘intent and direction’ saying such questions should have been raised much earlier.

The committee also comprised Dr Fiaz Chaudhry of LUMS’ Energy Institute, Zargham Ishaq of National Engineering Services of Pakistan (Nespak) and Abid Lodhi, a consultant.

Also blames PDM govt, slams Nepra for jumping the gun

The committee interviewed all the stakeholders including key players in all Discos, Nepra and technical resources like Power Information Technology Company (PITC) and Power Planning & Monitoring Company (PPMC) for data collection, examination and collation.

The committee was constituted by the Power Division on the instructions of the Prime Minister’s Office after an investigation by Nepra found massive billing malpractices by all Discos including K-Electric as consumers across the country raised hue and cry over excessive bills in July and August 2023 and turned to streets in protest.

Delayed meter reading

Nepra had concluded that Discos were “charging excessive bills/detection bills to the consumers by adopting illegal and unlawful practices, therefore, prima facie, violated the Nepra Act, Consumer Service Manual (CSM), Terms & Conditions of Tariff and other applicable documents, etc”.

The committee consented with the basic assertion of Nepra that meter reading has to be based on the transparency of reading within a stipulated period and that this accuracy is achieved only when accurate snapshots with reading date are ensured and printed on the electricity bill. “Such is the design of the billing system that any lack of accuracy and delayed reading can and does result in a change of slab or status of the consumers who suffer pecuniary loss,” said the inquiry committee and did not accept the Discos claim that number of affected consumers was not huge. “People are not numbers. All Discos need to address this issue on an immediate basis.”

Without naming the then government, the probe committee said that “an increase in tariff was notified on July 26, 2023 with retrospective effect from July 1” and the majority of consumers had to pay two months’ electricity bill in August 2023. “It resulted in a sudden increase in electricity bills heavily encumbering the common man’s capacity to pay,” it said, adding that trend analysis of the last 32 months for all Discos data showed “a repeating pattern of meter readings going beyond 30 or 31 days. This phenomenon happens almost in all months and is more pronounced in the months when more holidays fall”.

The investigation team did not agree with Nepra’s allegation of deliberate overbilling based on malpractices and mala fide but said clearly it was inefficiency which should be addressed on priority.

All the members of the committee attributed this to extreme weather conditions, general holidays, bifurcation of sub-divisions, shortage of meter reading staff, transportation and up-to-date mobile sets which seemed to have been “ignored” by Nepra.

Financial gains

It asserted that the combined financial gain to all Discos in the said two months was just Rs1.95bn (about 0.22pc) of a Rs902bn billing which meant that the financial imprint of deliberate fraud should have been much larger. It said the reading staff was 31pc short of sanctioned strength as only 10,728 meter readers were working in all the Discos against a sanctioned strength of 15,547, leaving about 4,920 positions vacant.

At the same time, the committee also confirmed that despite an anti-theft and anti-corruption campaign of the power ministry over the past many months throughout the country “electricity theft through sophisticated and unsophisticated means exists in varying quantities in Discos”.

The committee commended only the KE for ensuring maximum transparency in meter readings because of the independent decision-making of its management without any obvious politicisation.

On the question of detection bills and their recovery, the committee again blamed Nepra for generalising failure in recoveries. It said the issue was of serious proportions in Sukkur, Hyderabad and Peshawar-based Discos while the performance of other Discos seemed “satisfactory”.

The report confirmed Nepra’s allegation of delayed meter replacements. The committee said several consumers were subjected to delayed reading and out of those many consumers suffered due to changes in slabs, protected and lifeline categories.

Mepco had the largest group of affected consumers — 40.8pc in July 2023 and 34.7pc in August 2023 of its domestic consumers — thus 53pc contribution came from Mepco followed by 20pc from Gujranwala-Disco.

Interestingly, while exonerating Discos’ managements of mala fide and deliberate overbilling, the committee said the “data at the sub-divisional level does not absolve the sub-divisional tier of certain specific sub-divisions where the variation between the two months are very high”.

It said adequate mechanisms did not exist in the consumer manual to protect domestic consumers in case of reading going beyond 30-31 days and also confirmed that delayed meter replacements created “plausible case of malpractice” and their snap accuracy was suscept to overbilling. Also, the report blamed managements for failing to hire the right number of meter readers and procure adequate mobile sets. On top of that, no Disco had approved modern IT solutions like GIS mapping.

The committee called for performance evaluation of all boards of the Discos as well as managements against key performance indicators relating to loss reduction and consumer satisfaction.

Published in Dawn, February 29th, 2024