Daily Times

THE Federation of Pakistan Chambers of Commerce & Industry’s (FPCCI) Businessmen Panel (BMP) has blasted the power distribution companies (DISCOs) for issuing highly inflated power bills to the trade and industry in the second quarter (2Q) of Apr-Jun of current fiscal year of 2024-25, who are already harmed by the high cost of doing business, discouraging investment in capacity and capability.

BMP Chairman and FPCCI former president Mian Anjum Nisar observed that the high cost would prove to be detrimental to the industries due to high cost of doing business and has also opened the floodgates of inflation. In addition to making the electricity bills costlier and unaffordable for the consumers, the hike in base tariff would escalate prices of all household goods being widely used in every household, he added.

Quoting a report based on information and data provided by Power Information Technology Company, he said that the scope of pro rata billing had been expanded beyond its original intent instead of solely revising bills for periods exceeding 30 days. All power companies, including Karachi Electric, have started applying pro rata adjustments to bills for periods fewer than 30 days. This has resulted in a “significant number of consumers being reclassified from “protected” to unprotected categories, from lifeline to non-lifeline, and from lower to higher tariff slabs, which resulted in inflated bills.

According to the report, pro rata adjustments were made for readings taken for periods under 30 days and subsequently scaled up to 30-31 days, with projected units for fewer days, using pro rata calculations. As a result, many consumers were impacted by pro rata billing for periods shorter than 30 days. Many lifeline consumers pushed out of monthly ceiling, paying almost double rates for electricity

Many users were pro-rated for three months running — April, May and June — contrary to the meter reading schedule. This is a violation of the Consumer Service Manual, the report found.

It held that ex-Wapda distribution companies (Discos) and KE had not replaced defective meters within two months, as required by Consumer Service Manual, which resulted in average billing. This in turn led to inflated bills.

Moreover, the power companies “in significant cases, recorded readings much earlier than the scheduled date and used a pro-rata calculation to adjust the readings during April to June”. This resulted in readings that were higher than what was actually recorded on the meter. Over and above that, bills issued by power companies over three months — April-June — had a serious discrepancy that the snap date did not match with the schedule data.

In the process, the investigation report noted, ‘lifeline’ consumers (using up to 50 units per month) were pushed out of their monthly ceiling and had to pay almost double the rates, Rs7.74 per unit instead of Rs3.95. In these cases, meter reading was done (recorded) for 27 days, which should have been 45-46 units, but this was pro-rated to 30 days, resulting in consumers slipping to the above 50-unit category, thus out of lifeline status and attracting twice the per unit rate.

Likewise, lifeline consumers of 51-100 unit per month were billed at the rate of Rs10.06 per unit instead of Rs7.74 per as they were billed on estimated basis for 30 days on the basis of 27 or 26 days reading.

Similarly, consumers in ‘protected category’ of 200 monthly units for subsidised rate were also disadvantaged and their pro-rata billing for 30 days instead of actual reading attracted per unit rate of Rs27.14 instead of their approved rate of Rs10.06 per unit — almost three times higher rate.

In the same pattern, consumers in 201-300 units per month in unprotected category were charged at Rs32.03 per unit instead of their entitled rate of Rs27.14 per unit.

Therefore, to protect the interest of consumers, the power companies have been directed that the “consumers charged on pro rata basis during April 2024 to June 2024 for readings less than defined billing months be adjusted with actual units so recorded”.

However, the units of remaining days which have been charged on pro-rata basis be adjusted on rates as determined by actual meter reading units, but the consumer category will remain the same, the regulator ordered.

Mian Anjum termed the increase in tariff unlawful and a violation of NEPRA’s own rules and regulations, as any increase in tariff has to be determined and implemented only after holding public hearings but unfortunately they have solely decided to raise the tariff without holding public hearings, he argued.

He condemned the National Electric Power Regulatory Authority’s decision to increase electricity tariffs, stating that the burden of power theft, mismanagement, and inefficiencies cannot be shifted to consumers on the pretext of fuel adjustment. Anjum Nisar stated that the constant increase in power tariffs on the pretext of fuel adjustment had increased electricity prices and added to the already high cost of trade and industry. Seeking comparable energy tariffs for domestic industries in order to capture the global market, he stated that due to high electricity rates, power theft became rampant as the tariff was unaffordable to consumers.