ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has sought recovery plan from Tribal Areas Electricity Supply Company (TESCO) in case the government withdraws tax exemptions to industry and meterization of domestic consumers.
The power sector regulator raised these questions during the scrutiny of TESCO five years (2025-26 to 2029-30) Investment Plan/ Business Plan according to which the Company has approval of Rs 14 billion investment.
Currently, TESCO supplies electricity for four hours to its domestic consumers who do not have meters whereas industrial consumers are exempted from load shedding because they pay their bills. The bills of non-metered domestic consumers are being paid by the federal government through allocation in the federal budget.
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“What are the plans TESCO has, in case tax exemptions to industry are withdrawn by the government and what about meters installed for domestic consumers,” enquired Chairman NEPRA, Waseem Mukhtar.
He averred that third party verification of Discos claimed losses will be made part of the determinations. NEPRA sought explanation on its financial performance and free cash flow position. TESCO’s metering system is limited to only 11 kV feeders and most of the domestic consumers do not have any meters.
NEPRA argued that TESCO should accelerate metering at the consumer and Continuous Development Plan levels and raised questions on 6% annual growth in Tesco’s investment plan.
The previous investment plan was underutilized due to unavailability of funds from the federal/provincial governments and non-metering of domestic consumers. Delays in projects like transmission grid projects have negative cost impacts on consumers.
Chief Executive Officer (CEO) TESCO informed the Authority that the Company’s recovery rate is currently at 95 per cent of meterized consumers starting from 58 per cent in 2021 adding that most of metered domestic consumers are paying their bills as are the industrial consumers.
He further stated that in December 2024, recovery was recorded at 94.4 per cent as the government has also disbursed the amount against the billing. Recovery from meterized consumers was Rs 7.5 billion against billing of Rs 7.5 billion in December which is historical as this had not happened in the past.
He acknowledged that there is problem of taxes in FATA and a court case is being heard owing to which approximately Rs 650 million amount is still deferred.
The CEO further stated that there is speculation that FATA will continue to enjoy tax exemptions till 2028 but added that it does not look possible that Federal Board of Revenue (FBR) will give them any exemption specially to industry after July 2025. He said installation of meters at all CDP points will be completed by June 2025 with civil works completed, while electrical equipment and meters procurement is under progress.
Consultancy services for T&D losses calculation has already been awarded to M/S Barqaab-PPI-OMS Consortium. The field survey is currently in progress. The T&D loss study will be completed in this year 2024-25. The results will be shared with the Authority.
Copyright Business Recorder, 2025
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