LAHORE: Chief Executive Officer (CEO) of Lahore Electric Supply Company (LESCO) Mujahid Pervaz Chattah has said that the distribution companies (DISCOs) could be profitable if National Electric Power Regulatory Authority (NEPRA) notifies tariff determination timely.
Talking to this scribe, he said LESCO has incurred losses during the fiscal year 2015 to 2018 due to a delay in notification of the tariff. He said the power purchase price is a pass-through item for a power utility company and a delay in adjustments of the power purchase cost is the prime reason for losses.
According to him, tariff determination and notification during the financial year 2018-19 had started showing gradual improvement in the financial results of the company. It may be noted that the audited losses of the company stood at 19,854 million in 2016, followed by 38,252 million in 2017, 65,550 million in 2018, 23,501 million in 2019, and 2,200 million in 2020.
He said the situation may improve further if the government of Pakistan notifies the tariff as well as the adjustments without delay. Also, he said the government should allocate transmission and despatch losses in view of the ground realities. Further, he said the government should also release subsidies well in time to curtail circular debt.
Media reports suggest that Prime Minister Imran Khan has approved increase in power tariff after a lapse of 10 months. The step is being taken to approach the International Monetary Fund (IMF) for resumption of $6 billion debt programme. While terming it a good step, LESCO chief has expressed the hope that there would be an early notification of the same to bring losses of DISCOs.
Copyright Business Recorder, 2020
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