Late submission of claims: Inter-Disco tariff differential subsidy slashed

The government has slashed budgeted inter-Disco tariff differential subsidy by 12 percent to Rs 57.5 billion from Rs 65 billion in 2017-18 due to late submission of claims and recovery through Tariff Rationalisation Surcharge (TRS), well-informed sources told Business Recorder. The government has budgeted Rs 105 billion for 2018-19 as tariff differential subsidy keeping in view expected increase in generation and subsequent electricity sale this summer, sources added. The ECC recently extended Tariff Rationalisation Surcharge at Rs 20.07 per unit to offset the impact of the subsidy.
"We are expecting 10-12 percent increase in sale of electricity this summer which will certainly have impacted on the subsidy," the sources maintained. The government, however, is worried about the expected jump in inter-circular debt this summer which may disturb power sector's financing arrangements. The sources revealed that the government recently paid Rs 50 billion to the energy sector whereas an additional Rs 50 billion will be distributed amongst the energy sector entities next week. PSO's power sector debt is around Rs 300 billion.
"We have recently given a briefing to the federal cabinet about recent spike in load shedding with the advent of summer which includes category-wise details about the existing load shedding schedule," the sources continued.
The Cabinet was informed that eight categories had been framed in the light of Aggregate Technical and Commercial (ATC) losses beyond routine technical losses. As per the government policy, the scheduled load management was zero for the first category (up to 10 per cent) ATC losses beyond technical losses and was gradually and proportionately increased to 12 hours for the 8th category ( up to 80.1 per cent and above ATC losses beyond technical losses).
The sources said, different factors led to unscheduled load shedding which included delays in coming online of different power plants such as Haveli Bahadur Shah (1,200 MW). This plant began generation a couple of days ago. Certain plants such as Jamshoro and Guddu were closed down due to repair and maintenance scheduled before Ramazan. The expected 1400 MW hydel power generation could also not materialize.
The Port Qasim Authority (PQA) transmission line also tripped, further reducing flow of 1200 MW to the national grid. However, the major factor was the shortage of furnace oil for Jamshoro and Muzaffargarh due to mismanagement of which the Prime Minister has taken strict notice. Fuel has been arranged for Jamshoro power plant. The RLNG-fired power plant at Bhikki would also be commissioned before Ramazan.
"There would be no unscheduled load shedding in Ramazan as there is also enough liquidity available in the power sector to sustain itself in the next 6-7 months," the sources maintained. An official told this scribe that the Power Division takes stock of load management situation every day at 9am and corrective measures are taken accordingly.