The Islamabad Chamber of Commerce and Industry (ICCI) has strongly opposed the government’s move to include various surcharges in power tariffs to cover the cost of line losses, debt servicing and interest payments due to which the electricity charges in Pakistan have become highest in the region as compared to India, Sri Lanka and Bangladesh and called upon the government to withdraw all such surcharges and make sufficient reduction in power tariffs which will facilitate the growth of business and industrial activities, providing sufficient relief to the common man.
ICCI President Muzzamil Hussain Sabri, Senior Vice President Shakeel Munir and Vice President Ashfaq Hussain Chatha said the power tariff surcharges in Pakistan accounted for more than 30 percent of the total charges of a commercial bill and were major factor for enhancing cost doing business in the country.
They said instead of bringing drastic reforms in power sector to cope with the problems of transmission and distribution losses, debt servicing and other liabilities, the government was forcing people to pay for the inefficiency of power companies by imposing surcharges which was highly unjustifiable and in violation of the rights of power consumers.
They said it was very unfortunate that ECC has directed NEPRA to include interest amount of billions of rupees, owed by the government to the power companies due to late payment, in the power tariffs of consumers while consumers have no role in such late payments.
They said government has already included debt service surcharge of Rs 0.30 per unit in October, 2014 in addition tariff increases of Rs 0.38/unit and Rs 0.60/unit under “Universal Obligation Fund” to pay the liabilities of power producers.
Now the government was reportedly pressurizing NEPRA to retain Rs 1.50/unit from total required reduction of Rs 3.20/unit under FPA and pass on the remaining Rs 1.70/unit reduction to consumers for February, which was deplorable.
They said Pakistan was generating 35 percent energy from furnace oil which was costing more than Rs 18/unit and it was very difficult for industry to maintain its competitiveness in a scenario of such high power tariffs. They said NEPRA had approved reference fuel tariff at Rs 9.53/unit in December last year when the prices of furnace oil were in the range of Rs 75,000 per tonne.
Now the furnace oil price has come down to about Rs 40,000 per tonne which means the actual fuel cost of power generation has declined to Rs 6.32/unit. They stressed upon the NEPRA to immediately make sufficient cut in reduce powers to pass on the full benefit of falling oil prices to the consumers.