The Senate Standing Committee on Cabinet Secretariat deserves credit for highlighting serious contradictions in government’s power policy that are adding to the woes of general public.
It was informed that electricity consumers have been charged Rs220 billion for 14,000 megawatts of inactive power, prompting members to question why consumers were being charged for electricity that was neither generated nor produced. The members also took exception to the fact that despite repeated announcements in Parliament claiming electricity had become cheaper and assurances that audits of independent power producers (IPPs) had been conducted while electricity remains a problem for 250 million people.
No doubt, government had long drawn talks with Independent Power Producers (IPPs) and revision of agreements with some of them enabled authorities concerned to pass on some relief in terms of downward revision of tariff yet volume of the capacity charges and surging circular debt substantiate the perception that not much has been done to address chronic challenges of the sector depriving consumers of a meaningful relief. The electricity tariff is still highest in the region and is one of the major factors affecting competitiveness of our falling exports. There is logic in unanimous demand of the Senate committee for a forensic audit of all IPPs to clarify how much electricity IPPs generated, how much they supplied and how much they received from government in capacity charges. The audit should also examine feasibility of the projects, land valuation, project cost, fuel consumption, machinery output and whether annual inspections of power plant equipment were conducted.
NEPRA officials claimed that increasing electricity sales was the only solution to capacity payments but how can sales increase in the presence of excessive tariff rate and an oppressive slab system that forces consumers to opt for solar solutions. Government should take warning of the committee seriously that major exporters have already shifted to wind power systems and that a time could come when no electricity could be purchased from the grid. Inaction being no solution, government should thoroughly review its power policy and make it consumer friendly.
