The Cabinet Committee on Energy (CCoE) has sought a viable plan for recovery of receivables of each Distribution Company (Disco) from Power Division by next week, official sources told Business Recorder.
The decision was taken on March 13, 2019 after discussion on power sector receivables outstanding against defaulters which included government departments as well as private consumers.
The amount of net receivables to Discos was Rs 701.197 billion against government departments and private sector and Karachi Electric (KE) of which over Rs 102 billion is outstanding against federal and provincial governments as of January 30, 2019. The Finance Division which is negotiating a financial package with the IMF will be taken on board in this regard.
It was stated that private defaulters have been further categorized into running defaulters and disconnected defaulters. Both types include domestic as well as industrial consumers.
The meeting was informed that running defaulters are those whose connections were not disconnected but previous electricity bills are still outstanding against them. They are directed to pay their outstanding dues otherwise their connection will be severed; whereas disconnected defaulters are those, whose connections have been cut off and they have been asked to pay their outstanding bills for restoration of connection.
The Power Division claimed that its drive against defaulters has proved successful with reasonable recovery.
The meeting was apprised that total net receivables of Lesco stood at Rs 21.812 billion, Gepco, Rs 16.042 billion, Fesco, Rs 2.421 billion, Iesco Rs 81.352 billion, Mepco Rs 10.319 billion Pesco Rs 123.122 billion, Hesco, Rs 68.041 billion, Sepco, Rs 100 billion, Qesco Rs 237.498 billion and Tesco Rs 40.581 billion.
Of this, the government receivables were Rs 11.132 billion, AJK Rs 114.361 billion, provincial governments, i.e, the Punjab, the KP, the Sindh and Balochistan Rs 31.324 billion, totalling to Rs 156.816 billion.
Receivables against private running defaulters' stood at Rs 448.986 billion and Rs 95.395 billion running defaulters.
The Cabinet Committee on Energy (CCoE) was informed that the huge amount on account of electricity supply is outstanding against the AJK government. There is a tariff issue in this regard as Nepra Act has not been extended to AJK. It was stated that the AJK government is demanding Water Usage Charges (WUC) on Mangla Dam at the rate of Rs 1.10 per unit at par with the Punjab and the KP on Tarbella Dam and Ghazi Brotha Power Project respectively. Currently, WUC is being paid by Wapda at the rate of Re 0.15 per unit.
The Finance Division is likely to deduct provincial governments' power sector outstanding receivables at source after due consultation process with the Power Division, well-informed sources told Business Recorder.
The Power Division has tailored a number of recovery plans for the last ten years but did not succeed due to which financial sector woes continued to worsen. The Power Division (erstwhile Ministry of Water Power) had assigned the task of recovery from defaulters to the National Accountability Bureau (NAB) and the Federal Investigation Agency (FIA) against some percentage of recovery. However, all the drives failed miserably.
Insiders claim that the CCoE's recent directive that Power Division should prepare a viable recovery plan indicates that the existing plan has not achieved the desired results.
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