12% increase in power tariff on the cards

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Even though a minister-level committee, headed by Finance Minister Hafeez Shaikh, again failed to devise a strategy to overcome the electricity shortage crisis, it unanimously decided on increasing the power tariff by 12 percent to bridge the gap between the determined and applied tariff during the current fiscal year, an official source said on Monday.
The ministerial committee, looking to resolve the crisis, was attended by Minister for Water and Power Naveed Qamar and Petroleum Minister Asim Hussain besides the officials of the ministries, Planning Commission and representatives of the Karachi Electricity Supply Company (KESC).
The meeting decided that a further increase in the tariff was required to zero the budgeted subsidy of Rs 51 billion kept for the current fiscal year. However, it failed to resolve many of the issues and decided that the meetings would continue at the officers’ level to resolve the issues of receivables from defaulters and improvement in power generation. The meeting was informed that the way out of the power tariff differential subsidy was straight implementation of the National Electric Power Regulatory Authority (NEPRA) determined tariff. The meeting was also informed that the required legislation was ready but had been dropped during the budget session as it was pointed out that it could not be part of the finance bill. It would be introduced in the next session of parliament.
A source said there were still discrepancies between the data shared by the Ministry of Water and Power and the Economic Reforms Unit (ERU), which still required to be reconciled. The ERU was touted by the government as its restructuring wing to improve the performance of the loss-making PSEs. However, during the last fiscal year it had not even managed to formulate boards for the power sector entities. The source said the KESC team came ill prepared to the meeting and failed to answer many queries. They wanted to continue getting subsidies supplies from PEPCO and sell it on higher tariff to consumers. Calling the meeting “direction less”, a KESC representative said on the condition of anonymity that there was a lack of seriousness to resolve the immediate issues.

1 COMMENT

  1. Well this PPP led government is determined not to increase its revenues by any means other than taxing the poor masses and taking huge loans which come with conditions which are to be met in ways as discussed above. Poor us and Jiye Bhutto!

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