ISLAMABAD – The circular debt in net term has reached the mark of Rs 230 billion, with the major contributors being inefficient power distribution companies (DISCOs) that have failed to control massive line losses and theft to the tune of Rs 125 billion per annum.
An official source said the government had decided not to increase power tariff during the current fiscal year and would attempt to bridge the remaining difference through better management and efficiency of DISCOs. The approaching summers would also be helpful in bridging difference as more flow of water would help generate additional cheap electricity.
The government has already significantly increased the power tariff on two percent monthly basis, the source said, adding that the remaining difference in the calculated and the applied tariff was of Rs 2 per kilowatt/hours. On average, electricity was being generated at Rs 10 per kilowatt/hours while it was supplied to consumers at Rs 8 per kilowatt/hours.
The source said the government wanted the DISCOs to reduce their line losses and power theft.DISCOs operating in Punjab had line losses of up to 10 percent, while KESC, HESCO, PESCO and QESCO have line losses more than 20 percent. One percent line loss amounted to Rs 2 billion per annum. The source said the government had estimated Rs 30 billion in power subsidy for the current fiscal year, but due to an increase in petroleum product prices in the international market, the subsidy was likely to escalate to Rs 120 billion during the current fiscal year.
About the improvement in DISCOs’ efficiency, the source said the formation of new boards of directors in the National Transmission Dispatch Company (NTDC) and DISCOs would help induct professional management to improve working.
Circular debt hovering around Rs 230b
