Daily Times

The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel (BMP) has stressed the need for large scale structural changes in power sector, controlling line losses of DISCOs by using modern technology, and customer-oriented business approach, as the public exchequer has been facing loss of billions of rupees by the power distribution companies.

FPCCI former president and BMP Chairman Mian Anjum Nisar stated that due to high electricity rates, power theft will become rampant as the tariff was unaffordable to consumers. Quoting the media report, he observed that that the performance of distribution companies (DISCOs) throughout 2023-24 remained very poor, and the expected power sector reforms were not achieved. Given the ongoing poor performance, it is apparent that, under the existing circumstances, the current DISCO setup is unlikely to be able to deliver the desired results.

No significant improvement has been witnessed on part of some DISCOs in this regard. During FY2023-24, the overall actual losses of DISCOs were 17.21% against the actual loss of 15.68% in FY 2022-23. The actual T&D losses are much higher than the allowed T&D losses, which is 11.31%. Unfortunately, the majority of DISCOs have not adhered to the NEPRA given targets, except FESCO, GEPCO, and K-Electric which have managed to keep their losses below the levels or equal to targets set by NEPRA. However, other DISCOs have exceeded these limits, which contributed to a substantial loss of over Rs165 billion to the national exchequer.

Anjum Nisar said that it is an undeniable fact that DISCOs are deliberately drawing less power than their demand, despite being provided with an adequate quota on account of loadshedding based on Aggregate Technical & Commercial losses policy. The AT&C based loadshedding is still being carried out and DISCOs particularly PESCO, QESCO, SEPCO and HESCO have considered it an easy path for them to manage the recovery rather than to put the efforts and ensure maximum collection.

On recoveries, the report said it is observed that only one DISCO i.e., IESCO has significantly achieved the target of 100% recovery in fiscal year 2023-24. Moreover, GEPCO, FESCO, and MEPCO are nearest to the target and achieved the recoveries of 97 to 98%. Similarly, PESCO, LESCO and K-Electric have crossed the figure of 91%. Moreover, HESCO and SEPCO remained the same as in previous year, somewhere in middle with reported values of 76 and 67.2%. However, QESCO has been witnessed as worst performing DISCO among all with the reported position of 35.8%.

On System Average Interruption Frequency Index (SAIFI), the report said that none of the distribution companies have been able to meet the SAIFI standard of 13. Regarding System

FPCCI former president stated that due to high electricity rates, power theft will become rampant as the tariff was unaffordable to consumers. In a meeting held here on Sunday, he forwarded several recommendations so that the small industry could deal with the challenges posed by the present economic crisis, saying mere statements would not work unless solid measures are taken by the government, including a sizable reduction in fuel prices, bringing down key policy rate to single digit, regionally competitive energy rates and substantial cut in duties and taxes.

The Businessmen Panel called for significant cuts in import duties and waiver of sales tax, income tax, and additional income taxes, which are still being charged in this time of grave crisis. Mian Anjum Nisar asked the government to take concrete steps to keep the industrial wheels running especially for SMEs, to save the livelihood of millions of workers associated with the small industries.