ISLAMABAD: The Finance Ministry on Thursday urged the Ministry of Water and Power to revise the Rs 383 billion subsidy during a Cabinet Committee on Energy. The Ministry of Water and Power has sought a subsidy of Rs 383 billion to alleviate the power sector's financial woes and enhance power generation to reduce the duration of power cuts in the country, sources told Business Recorder on Thursday.
They said that the Finance Ministry had not agreed to the amount demanded by the Ministry of Water and Power as subsidy and requested Water and Power Ministry for revisiting the figure on Thursday during a Cabinet Committee on Energy. The meeting, presided over by the Finance Minister, was reportedly informed by officials of the Secretary Water and Power that they had to pay to Pakistan State Oil (PSO) for fuel and logistics.
The meeting was informed that Rs 20 billion was needed for logistics along with Rs 35 billion for fuel. Power sector's financial position was been badly affected due to Rs 172 billion outstanding against various public sector departments at federal and provincial level. Total receivables, the meeting was told, amounted to Rs 477 billion.
Officials of the Ministry of Water and Power argued that a gap of Rs 90 billion had not been bridged in the tariff differential subsidy of Rs 185 billion budgeted for the current fiscal year. The gap between receivables and payables widened to Rs 90 billion, they said. The Ministry of Water and Power wanted to know how much subsidy would be provided to them for the power sector. The Ministry of Finance insisted the Water and Power Ministry to re-examine the amount of subsidy.
The meeting remained indecisive about taking concrete decisions to minimise the growing demand-supply gap and expected early rains that might add 1,000-megawatt to the system, easing the problem of power outages. The meeting opined that enhancing fuel supply to 28,000 tons to IPPs could add 250MW to the system. The addition of power generation would help maintain the demand-supply gap at 4,000MW level.
Officials said that electricity demand stood at 18,055MW during the season. The meeting expressed the hope that addition of 1,000MW hydel power following rains as well as 650MW of the KESC and 185MW of RPPs to the system would help them keep electricity outages to three hours across the country in Ramazan between Iftar till Taraveeh.
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