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Power sector inefficiencies ate up Rs383 bn in 2011-12

The power sector ate up about Rs383 billion in the financial year 2011-12 that included Rs160 billion under the head of line losses and electricity theft, Rs120 billion on account of inefficiency in recovery of bills from private consumers and Rs103 billion on account of subsidies, said a senior official of the Ministry of Water and Power.

“The system sustained a huge loss of Rs160 billion in the last financial year just on account of stealing of electricity and transmission and distribution losses,” the official said. “Peshawar Electric Supply Company (Pesco) braved an over Rs50 billion hit, which is one-third of total losses. These figures have been worked out as per the claims of the government, which is facing an average of 19.5 percent line losses,” the official said.

Further, in the jurisdiction of Pesco, the electricity theft ratio stands at 30 percent, Hyderabad Electric Supply Company at 19 percent, Sukkur Electric Power Company at 25 percent, Quetta Electric Power Company at 22 percent, whereas in the whole of Punjab electricity theft stood at two to three percent only.

He said that all distribution companies claim that average line losses stand at 19.3 percent but these losses are actually in the range of 25 to 28 percent. And a one percent loss translates into a loss of Rs8.50 billion.

The official also disclosed that the inefficiency in recovery of electricity bills has emerged as a big issue owing to which the system has braved the loss of over Rs120 billion in the last financial year. “We are going to carve out a plan to introduce prepaid meters so that this issue can be resolved. If this system gets started, the recovery of bills would be 100 percent at least from the private consumers,” the official said.

In Pakistan, some local companies are making electricity meters, of which some are very fast and some are very slow, which ultimately impact the bills of the consumers, he said.

The official said that the government had last year granted about Rs103 billion subsidy on tariff while the USAID has offered to work with the government to install solar panels worth Rs40,000 for lifeline consumers. He said this way they would use the solar electricity in the daytime and if they have excessive electricity, that would be included in the system and in the night, the lifeline consumers would be given the electricity.

He said that right now there are 20 million consumers, of which 5.1 million consumers are lifeline consumers. The lifeline consumers are currently being given Rs23 billion, which is at the higher side, he said. He said that a huge amount of Rs620 billion has been spent on purchase of furnace oil to generate thermal power whereas the cost of electricity generation remained at Rs811 billion last year.

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