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Govt to purchase load management system for power sector

The government has decided to purchase a load management system for the power sector from abroad after arriving at the conclusion that the existing system is flawed and can be tampered with, sources say.

“Prime minister Raja Pervez Ashraf raised questions about the authenticity of data generated by the Central Power Purchasing Agency (CPPA) on the load management system that was showing more demand even in those days when there was rain and directed the authorities concerned to install a modern load management system,” said official sources. Purchasing a French system is one of the available options.

Despite repeated attempts, no top official of the Ministry of Water and Power was available for comments. Power sector recovery stands at 64 percent only, creating a hole of Rs320 billion per annum that is piling up circular debt.

“We have handed over copies of section nine of the National Accountability Bureau Ordinance to the CEOs of all distribution companies and informed them clearly that all those who are found guilty of inefficiency in terms of recovery of bills or mismanagement will have to face investigations,” said a senior official.

In the last two months, the official said, long hours had been spent trying to find a solution to the power sector crisis but one thing became crystal clear – without reforming the sector and showing political commitment this regime would not be able to achieve any improvement.

Sharing power sector data, the official said that 81.49 billion units of electricity had been produced, of which 65.6 billion units were sold. This indicated a gap of 16 billion units between produced and sold units.

The power sector line losses stood at 19.4 percent against NEPRA’s permitted 16.3 percent so alone this head was causing a Rs28 billion loss to the power sector. The cost of generated electricity stood at around Rs900 billion but through recovery the collected amount stood at Rs470 billion per annum.

After providing a subsidy to the power sector to the tune of Rs106 billion and the KESC Rs45 billion, total received amount stood at Rs581 billion while the remaining Rs319 billion became part of circular debt every year.

“Until and unless this gap is closed the power sector crisis cannot be resolved on a permanent basis,” said the official.

The ratio of recovery in distribution companies indicated that recovery in some of them was far from satisfactory. In Sukkur electric supply company recovery was just 20 percent, in Quetta electric supply company it was 36 percent, in Hyderabad electric supply company it was 50 percent and in Peshawar electric supply company it was 50 percent. The recovery in Lahore electric supply company, Gujranwala electric supply company, Islamabad electric supply company and Multan electric supply company stood at more than 80 percent.

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