National Electric Power Regulatory Authority (Nepra) has accused Karachi Electric and ex-Wapda Distribution Companies (Discos) of submitting flawed data which has been found to be far from the on-ground reality.
Nepra has released performance evaluation report of KE and Discos for 2014-15 along with comparison of 2010-11, 20111-12, 2012-13 and 2013-14 on Friday at a time when the regulator has developed challenging relations with the Ministry of Water and Power.
According to the report, Nepra is the sole regulator of power sector in Pakistan and protection of consumer interest is an integral part of its regulatory regime but when it comes to protection of consumer interest, it is the distribution system that most immediately affects the consumers.
Nepra has claimed that it is cognisant of this fact and back in 2005 it framed Nepra Performance Standards Distribution Rules 2005 (PSDR) with a grace period of four and five years to distribution companies and K-Electric, respectively, to improve their network so as to ensure compliance with the performance standards.
Under PSDR, each Disco is required to submit to Nepra an Annual Performance Report (APR) in the format as prescribed in the PSDR. These performance reports are analysed by Nepra in light of the performance parameters prescribed in PSDR.
The APRs for the year 2014-15, submitted by the distribution licencees, were reviewed on the basis of parameters namely, transmission and distribution losses, recovery, System Average Interruption Frequency Index (SAIFI), System Average Interruption Duration Index (SAIDI), timeframe for new connections, load shedding, complaints, safety and fault rate.
Nepra has prescribed individual targets of T&D losses for all the distribution licencees through their respective tariff determinations. It was observed that except IESCO, all the Discos fell short of achieving the prescribed targets to varying degrees. In particular, PESCO, QESCO, HESCO, SEPCO and K-Electric lagged far behind the Nepra's prescribed targets.
It was noted that full recovery of electricity bills remained an elusive goal for most of the distribution licencees, except FESCO (100%), MEPCO (100%) and IESCO (99.8%). QESCO in particular showed the worst recovery rate at 32.6%. The trend of recovery rates over time remains erratic for all the Discos reflecting the need for a systemic approach at improvement.
SAIFI is a performance standard which measures the average frequency of interruptions while SAIDI measures average duration of interruption. The data provided by the Discos regarding SAIFI & SAIDI seemed incorrect. Through subsequent monitoring/verification it was confirmed that the data submitted by the companies does not represent factual position.
While reviewing the data pertaining to the percentage of eligible consumers who were not provided new connections within the statutory timeframe, it was observed that IESCO tops the list with zero pendency. On the other hand, FESCO (25%) was the worst followed by SEPCO (14%) and then QESCO (13%).
The data regarding complaints provided by Discos licencees was observed as unrealistic. For instance, HESCO & SEPCO, having 1 and 0.7 million consumers reported only 15 and 24 complaints per day respectively. Similarly, according to data provided by HESCO and LESCO, both have achieved 87% and 80% reduction in complaints respectively as compared to previous year, which is contrary to the factual position noted by Nepra team during the inspection.
According to the performance evaluation report, Nepra considers safety as an important parameter for measuring the performance of distribution companies. The distribution licencees reported that around 226 fatal accidents of employees and public occurred in the year 2014-15 showing an increase of 15% over the previous year.
Nepra maintains that it is quite evident that full recovery remains an elusive goal for most of the DISCOs. The most dismal performance has been shown by QESCO, which consistently remains below 50% and has recently reached as low as 33%. Similarly, SEPCO and HESCO have achieved alarmingly low recovery rates during 2014-15. The trend of recovery rates of most of the Discos remains erratic. A consistently increasing trend may have reflected a systemic improvement by the Discos. Every Disco has a variation in trend over a period of last five years. This demonstrates the weakness of Discos' management which could not maintain sustainable improvement.
Nepra has recently excluded this parameter from the performance ranking exercise of the Discos and K-Electric given the fact that the data provided by the licencees was incorrect and not based on ground realities. For instance, the SAIFI of IESCO is 0.036, which implies that each consumer, on average, experienced less than one interruption in 2014-15 due to IESCO's own system fault, which is quite questionable and very far from reality.
Similarly, the SAIFI of LESCO is 52.49, which means that each consumer, on average experienced 52 interruptions in 2014-15 due to LESCO's own system faults. The inaccuracy of the data was further established by Nepra through monitoring and inspections of various Discos. Notwithstanding that, distribution companies can reduce their number of interruptions and can improve their SAIFI by performing regular O&M activities as colossal amounts are being allowed by Nepra every year. Based on the repeated requests of Discos, a process regarding review of reliability standards ie SAIFI & SAIDI was initiated by Nepra. Based on the feedback of stakeholders and proposals of consultants based on international best practices, Nepra has set targets of SAIFI & SAIDI for the years 2015-16 and 2016-17 separately for each Disco which is 5% reduction over mean value of last five years data of SAIFI and 10% reduction over mean value of last five years data of SAIDI.
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