ISLAMABAD: National Electric Power Regulatory Authority (Nepra) said on Tuesday that performance of power Distribution Companies (Discos) is pathetic and cannot be improved without structural reforms.
These observations were shared by Vice Chairman Nepra Rafique Ahmad Shaikh at a meeting of National Assembly panel, constituted to discuss and recommend resolutions of issues faced by legislators with respect to Karachi Electric (KE) and Discos and Gencos of Sindh.
The panel comprised of Lal Chand, MNA; Engineer, Sabir Hussain Qaimkhani, MNA and Saira Bano, MNA described the performance of Discos, especially in Sindh, as “awful” with respect to service delivery despite collection of resources from power consumers through high tariffs.
The panel also warned that it could recommend dissolution of Boards of Hyderabad Electric Supply Company (Hesco) and Sukkur Electric Power Company (Sepco), if issues related to their service delivery are not resolved.
The panel members said that when their recommendations are not being given any weight by the Discos, then what will be the position of general consumers.
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Vice Chairman Nepra Rafique Ahmad Shaikh, who also hails from interior Sindh and represents Sindh in Nepra, said that the current model of Discos cannot perform, adding that structural reforms are needed to make it functional.
Shaikh, who also has experience in a foreign country, said that Discos’ performance was perhaps better under Water and Power Development Authority (Wapda), which implies that unbundling and corporatisation of power sector has made the power system worse.
He disclosed that Discos have been given Rs363 billion during the last five years for system improvement and development but reduction in losses was just half a percent. “It is impossible that the Discos will perform within the existing system. Consumers have never been given relief in terms of service-delivery despite continuous increase in tariff,” he maintained.
Shaikh said that Hesco’s coverage area is 77160 square kilometres. He questioned as to how the company can repair a burned or faulty transformer in a day. He said, at least two days are required to bring a faulty transformer to Hyderabad.
He said, Nepra recently imposed a fine of Rs31 million on Hesco due to deaths by electrocution, and another decision will be announced within days. He said all those consumers who were over-billed during holidays will be compensated.
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Senior Joint Secretary, Power Division Alam Zeb Khan informed the panel that the Ministries have signed performance contracts with the Prime Minister, which will be notified soon.
He further contended that performance benchmarks will be set for the Discos in the light of contracts with the Prime Minister and if any Disco failed to perform as per agreement, action will be taken against their management.
Chairman Hyderabad Electric Supply Company, Engineer Shaikh Jamil Gul informed the panel that over Rs11 billion has been earmarked for system improvement which includes protection equipment for transformers, installation of meters on transformers to check losses, replacement of existing cable with ABC cable to control theft and provision of equipment and vehicles to personnel to avert fatal incidents.
He said, Board has also granted approval of Hesco’s own transformers’ workshop so that repair work is completed within the company.
CEO Hesco Rehan Hamid apprised the panel that the company has submitted multi-year tariff to Nepra, which also includes development budget, adding that as the regulator approves the tariff, company will commence development on long-term basis.
Engineer Sabir Qaimkhani said that he is ready to extend all possible help to Hesco, if it spends funds on improving the system to curb theft and reduce losses.
Saira Bano MNA spoke on corruption in Hesco with reference to transfers and postings of staff. The issues of Gencos employees’ pension and adjustment of existing in Discos also came under discussion.
CEO, Genco Holding Company Limited (GHCL) expressed the intent to enhance investment on rehabilitation of Guddu Power Plan 747 MW if National Power Control Centre (NPCC), the system operator, assures that it would allow its operation as per merit order. He said, GHCL did not support de-licencing of Gencos but the CCoE took its decision after getting information from other stakeholders. Chief Operating Officer (COO) KE, Aamir Zia said that there is a need to provide mental support in addition to giving them protective equipment.