ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has accused the Power Division of carrying out load shedding on the basis of Aggregate Technical & Commercial (AT&C) losses without its approval.
The regulator has brought this issue to the notice of Federal Cabinet, in its recent meeting, wherein Nepra's Annual Report 2019-20 and State of Industry Report, 2020 was discussed.
The Cabinet Division noted that Section 42 of the Regulations of Generation, Transmission and Distribution of Electric Power (Amendment) Act, 2018 stipulates that NEPRA shall submit, to the Council of Common Interests and to the Federal Government, at the end of every financial year, but before the last day of September of that year:(i) a report on the conduct of its affairs for that year including anticipated developments for the following year and ; (ii) a report on state of electric power services in the country identifying the ownership, operation, management, efficiency and control of electric power facilities, amount of transmission and generation capacity, present and future demand of electricity, cost of electric power services and other matters relating to electric power services.
In pursuance of the statutory requirement, NEPRA's Annual Report, 2019-20 and State of Industry Report, 2020 was submitted before the Cabinet. While briefing the Cabinet on the two reports Chairman NEPRA, Tauseef H. Farooqi highlighted the following salient points/functions of Nepra: (i) the grant of various licenses for Generation, Transmission, Distribution Tariff: (ii) determine tariff, rates, charges and other terms and conditions Monitoring & Enforcement; (iii) evaluate performance and ensure compliance, Consumer Affairs and: (iv) resolution of consumer complaints/disputes.
Managing high electricity prices and in turn circular debt through: (i) effective governance (A-Z of power industry);(ii) induction of the cheapest electricity (RE/Hydro); (iii) operating efficient plants on optimal load;(iv) retirement of inefficient plants;(v) adherence to Economic Merit Order (ECO); (vi) adequate transmission & distribution infrastructure; (vii) decreasing T&D losses and improving recoveries; (viii) improving sales growth specially sale to industrial consumers and; (ix) eventual pivatization of Discos to be run as commercial entities.
Nepra pointed out the following major challenges; (i) operation of inefficient public sector Gencos; (ii) under-utilization of "take or pay" based power plants;(iii) noncompliance of Economic Merit Order;(iv) Transmission & Distribution System Constraints;(v) load shedding on the basis of AT&C losses (not approved by NEPRA) and ;(vi) declining energy sales and recoveries due to the pandemic.
According to Nepra, during 2019-20, actual T&D losses of Pesco were 38.69 percent against determined losses of 21.33 per cent, Tesco-16.19 per cent against 11.96 per cent, Iesco-8.69 per cent against 8.60 per cent, Gepco-9.51 per cent against, 9.51 per cent, Lesco-12.40 per cent against 10.88 per cent, Fesco-9.62 per cent against 10.10 per cent, Mepco-15.23 per cent against 14.90 per cent, Hesco-28.82 per cent against 19.47 per cent, Hesco-28.82 per cent against 19.47 per cent, Sepco-36.27 per cent against 18.11 per cent, Qesco-26.68 per cent against 17.15 per cent and K-Electric-22.95 per cent against determined losses of 17.76 per cent. The average actual losses were 18.50 per cent against determined losses of 14.50 per cent. The average recovery during 2019-20 was 89.23 per cent.
During a discussion, the Minister for Energy, Omar Ayub Khan, pointed out that a $ 400 million World Bank funded project to upgrade the distribution system was being inordinately delayed for want of approval by the Planning & Development Division. The Prime Minister directed that a mechanism be developed to track the high priority projects of national importance to obviate delays.
The Cabinet Secretary proffered a suggestion of oversight by a Cabinet Committee to monitor the performance of regulatory authorities. This was important as Cabinet Division, where most of the regulatory authorities are parked to keep them at arm's length from line Ministries, lack the expertise to judge the performance of these authorities. In such a scenario the responsibility of any bungling falls on the political government while the regulatory authorities remain unaccountable.
While acknowledging the need to ensure the independence of regulatory authorities the members concurred with the proposal of oversight on the regulators. It was pointed out that with the establishment of CCI Secretariat these regulatory authorities would be transferred to it and the CCI, as mandated by the Constitution, would monitor the performance of these authorities.
Copyright Business Recorder, 2021
Comments
Comments are closed.