IT is for umpteen times that Prime Minister Shehbaz Sharif and senior members of his team expressed their intentions to bring down rates of electricity for different consumers and reform the energy sector but the ground realities speak otherwise. As plans to check the ever increasing circular debt are not producing the desired results, the authorities concerned are repeatedly resorting to the same old practice of hiking the tariff and this policy has a telling impact not only on individual consumers but also the industry, especially the export sector.
It was in this backdrop that the Prime Minister, on Thursday, chaired a meeting on reforms in the power sector, which dwelt upon issues, proposed reforms and recommendations regarding the power distribution companies, their losses, privatisation and outsourcing. Apart from approving reforms concerning National Transmission and Distribution Company (NTDC), he asked the authorities to prepare a comprehensive plan to supply electricity to the industrial sector at a low cost to improve the performance and efficiency of industries. He also wanted a comprehensive plan for the provision of power-efficient fans to the needy at affordable prices. It is pertinent to point out that the government is quick at declaring its intentions to provide relief to this or that segment of the society in view of the back-breaking inflation and squeezed economic opportunities but very slow at implementation. During his tenure as PM of the Coalition Government, Shehbaz had also announced a plan to increase the share of solar and wind energy in the national energy mix as part of the medium and long term solution to the issue of unbearable tariff besides making pledges to provide solar panels to people at subsidized/affordable costs. While the Government has yet not taken any worthwhile step to make solar panels available at a reduced cost, the excessive tariff has forced the people to install solar systems, which are contributing effectively to bring down their electricity bills. However, there are disturbing reports that the government is now contemplating to slashing rates paid to consumers who generate solar power through net metering. At the moment, net metering users are receiving Rs21 per unit for excess electricity fed back into the grid, but the government is looking to cut this rate to Rs11 per unit, resulting in a loss of Rs10 per unit for solar power generators. The government must avoid the temptation of doing so as this would discourage trends towards greater use of the solar energy by individual consumers forcing them to rely on costly power from Discos. In fact, the Government itself needs to switch to solar power generation so that cheaper electricity is produced during day time while plants based on costly fuel can be switched on when sunlight is not available. Similarly, a comprehensive plan should be chalked out for indigenous development of energy efficient home appliances as part of the strategy to save electricity. Instead of providing limited relief to limited segments of the society, the government should provide subsidy and relief to encourage local manufacturing of such appliances so that these are available to all at affordable costs. The government may consider tax exemptions for the purpose in the next budget to encourage local manufacturing as well as import of energy efficient appliances like fans, refrigerators, air-conditioners, washing machines, air cleaners etc. The direction for provision of electricity to the industrial sector at reduced rates is understandable as increased cost of production is rendering our goods uncompetitive in the international market. However, it is earnestly hoped that this would not be done at the cost of other categories of consumers that are also overburdened. It is also time that the Government takes concrete but well conceived measures to reform the entire energy sector taking care of line losses, electricity theft, dilapidated transmission and distribution systems, higher cost of electricity generation and the circular debt that has assumed menacing dimensions.
