‎Power woes magnify and summers are not even here yet

• Govt carries out unannounced load shedding – 12 to 14 hours in urban areas and 16 to 20 hours in rural areas, as power shortage crosses 7,000MWs
• Govt decides not to ask PSO to arrange furnace oil on its own as the entity had defaulted on Rs 50b of six local banks and LCs of Rs 46 billion

Badly hit by the shortage of furnace oil, Water and Power Ministry Thursday ‎adopted “unannounced load shedding” in the country after the gap between demand and supply of electricity crossed 7,000 megawatts (MWs) even during winters.

Keeping in view the looming power crisis, the prime minister had cancelled his visit to Switzerland for keeping a watch on the country’s energy situation. The PM was scheduled to attend the World Economic Forum (WEF).

An official in Water and Power Ministry told Pakistan Today that the shortage of furnace oil had badly affected the power generation by the independent power producers (IPPs), compelling the distribution companies to go for unannounced power load shedding.

The power sector owes Rs 176 billion to Pakistan State Oil (PSO) while its receivables have surged to over Rs 200 billion.

“The water and power minister had briefed Prime Minister Nawaz Sharif and other participants of the meeting about the situation that his ministry owes billions of rupees to the Petroleum Ministry which had flatly refused to provide furnace oil to the IPPs as its own resources had dried out. From now onwards, furnace oil could only be imported or the ministry may also seek help from local importers,” the official said.

The source said that the government had decided not to ask PSO to arrange furnace oil on its own as the entity had defaulted on Rs 50 billion of six local banks and LCs of Rs 46 billion. The government will now first provide finances to PSO and then ask it to import furnace oil.

The source said that the meeting chaired by the premier on Thursday had discussed in detail the power crisis and this was the reason why neither the petroleum minister nor the acting petroleum secretary attended the meeting held at Prime Minister’s House.

“Rather, Finance Minister Ishaq Dar, finance secretary, Water and Power Minister Khwaja Asif along with water and power secretary had attended the meeting,” the source added.

The source said that Asif sought immediate release ‎of funds from the Finance Ministry. The premier, while accepting his request, directed the Finance Ministry to release funds for import of furnace oil.

The source said the duration of power suspension in urban centres was around 12 to 14 hours whereas it was from 16 to 20 hours in rural areas.

The source said that furnace oil stocks used by IPPs for electricity generation were rapidly drying up, which is worsening the power crisis in the country. PSO had formally informed the government that it is unable to import furnace oil due to lack of funds, the source added.

According to source, an agreement was signed with BYCO and PARCO to provide furnace oil on daily basis to IPPs, but it could not help meet the demand as no ship containing furnace oil was expected till a new agreement.

The source said that Finance Ministry has been asked to pay Rs 27 billion to PSO for the import of 18,000 metric tonnes of furnace oil against the L/C for one month.

“Now in future, PSO will be provided with liquidity after which the entity will import furnace oil,” the source said, adding that the PSO needed Rs 27 billion every month to ensure the supply of furnace oil and the ministries of finance and water and power will have to ensure the required payment to PSO.

The spokesperson for the Ministry of Water and Power Wednesday claimed that duration of electricity load shedding will not be increased as power generation companies have enough furnace oil to deal with the situation.

The spokesperson further said that two ships carrying 100,000 metric tonnes of furnace oil is likely to reach the country by Sunday.

In the meanwhile, the government has given another date to end power crises; 2017. On Monday, Minister for Water and Power Khawaja Asif told journalists that the government is working a number of projects to work towards this objective.