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PM, ministers have no plan but to raise electricity rates

Prime Minister Raja Pervaiz Ashraf, along with his Water and Power Minister, appears to have no alternative except to raise power tariff for controlling the line losses, all set to touch Rs250 billion this year.

“Only solution to overcome this issue is to increase the tariff which has also been recommended by international experts on bridging the gap between purchase and sale price of electricity,” he told the Council of Common Interest (CCI).

Apart from the piling circular debt, load-shedding, inefficiency and mis-governance, the line losses have crossed Rs209 billion figure and is to reach new heights, the last CCI meeting was told by the Ministry of Water and Power.

The minutes of the CCI meeting quote the PM saying: “In case the line losses cross the limit of 7 to 8 percent, it can be attributed to theft which needs to be controlled.” Punjab Chief Minister Shahbaz Sharif was the first to take up this crucial issue before the CCI.

According to the water and power experts, different power distribution companies in Pakistan have different line losses as Hyderabad and Quetta Electricity Supply companies are close to 40 percent.

“In fact, the actual line losses are small and power theft is the major reason behind overall losses, but all is being mentioned in the one account of line losses,” they said.

Seeking provinces’ support, the prime minister emphasized that efforts need to be made to clear the receivables from public and private sectors with the help of provincial governments without considering political differences.

Water and Power Minister Ch Ahmed Mukhtar and his predecessor Syed Naveed Qamar, respectively, were also present, but neither they nor the premier urged for adopting good governance approach or any other option except letting the rates to go up.

The Punjab CM, taking up the specific question, pointed out that the issue of circular debt is a reality and is mainly due to differences of generation cost and the consumer rates and exorbitant line losses and theft.

He highlighted the problem of circular debt close to Rs500 billion which is proving drag on for national economy and is consistently increasing annually.He stressed his point to overcome this issue within a limited time. He mentioned that we need to move for its immediate solution as increase in the circular debt is likely to aggravate the situation of the economy as well as law and order.

In this respect, he (CM) mentioned that action needs to be taken against those industrial units which are stealing electricity and earning profits, according to the CCI minutes.

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