Power shortfall on Thursday surged to 6000MW on Thursday as a result 12 hours of outages in urban areas and 18 hours in rural areas are being carried out. Officials of Ministry of Water and Power, Petroleum Ministry and Finance Ministry revealed that despite the involvement of half a dozen ministries and related departments/entities operating in the power sector no short or medium term solution has been found as yet.
The officials stated that current energy crisis could be resolved however every issue has been politicized in the country. "Pakistan has the capacity to immediately resolve energy crisis as our installed power generation capacity is about 23,000MW of which 19,000MW is available against country's peak demand of 17,000MW," said a top official of the Ministry of Water and Power, on a condition of anonymity. The problem, he added, was the circular debt and the inability of the government to take necessary steps to deal with the debt issue.
The official said that currently estimated electricity shortfall in the country was around 6000 megawatts, which would further increase within the next few weeks, adding that if the government seriously wanted to resolve the energy crisis an integrated energy ministry was a must otherwise the problem would persist.
The following ministers and departments are involved in the power sector: Planning Commission, Ministry of Finance, Ministry of Petroleum arranges gas/oil for power sector, Ministry of Water and Power, Water and Power Development Authority (WAPDA) and Indus River System Authority (IRSA).
At a time when hydel power generation had declined to 1,000MW against potential capacity of 5,000MW due to water shortages the government's reliance on Independent Power Plants (IPPs) had increased, while IPPs were unable to utilise their full capacity due to outstanding dues, the official maintained.
Sources in the Ministry of Petroleum said that the Water and Power Ministry had requested an additional 152 Million Cubic Feet per Day (MMCFD) gas supply for four Independent Power Producers (IPPs) but currently Petroleum Ministry was not in a position to arrange additional gas for power sector.
"The Petroleum Ministry is already providing more gas to power sector as compared to last year and gas supply contracts with these four IPPs were terminated last year. The Petroleum Ministry has proposed that if the government wants additional supply for power, it will have to curtail gas to either CNG, or fertiliser sector or industry," the officials added. An electricity unit produced by using gas costs Rs 5 while furnace oil-based production costs Rs 18.60 per unit, he said.
The National Electric Power Regulatory Authority (NEPRA) recently approved Rs 6.39 per unit fuel adjustment surcharge to be recovered from consumers on account of increase in fuel cost for four months - October 2011 to January 2012. An amount of Rs 77 billion is outstanding on account of fuel surcharge for the months of October to January.
Sources said the power sector's recovery plan finalized by the Cabinet Committee on Energy identified that the collection of Pepco system was 88% of total billing, which meant Rs 12 out of Rs 100 billed were not recovered. This was costing Rs 65 billion annually which the committee failed to rectify.
Karachi Electric Supply Company (KESC) is another challenge to the power sector as well as to the federal budget as annual cost of subsidy to the KESC is Rs 66 billion. Sources said that the delay in payment of tariff differential subsidy, non collection of the billed amount, higher electricity losses than allowed by NEPRA and late surcharge payment are major factors contributing to piling up of circular debt.
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