Circular debt, capacity payment: Senate panel for integrated energy system to tackle issues

Terming the circular debt and capacity payment as primary challenges to the power sector as well as economy, the Senate Standing Committee on Power unanimously underlined the need for developing an integrated energy system to deal with these issues.

A meeting of the Senate Standing Committee on Power chaired by Fida Muhammad remarked that rapid increase in circular debt and existing system are dragging the country down and there is need to work on urgent basis to fix the power sector issues.

Senator Nauman Wazir stated that capacity payment is increasing because of surplus power as there is no need of more power, while Senator Shibli Faraz stated that surplus electricity is as bad as deficiency of electricity.

The National Transmission and Dispatch Company (NTDC) and power sector officials revealed to the committee that the country is having 35,900MW power whereas total demand of electricity during peak season was recorded at 23,500MW.

The committee members, especially ruling party's Senators Shibli Faraz and Nauman Wazir, stated that extra capacity is killing the power sector and economy and there is no answer to the question as to who has been responsible for this. They added that capacity payment is increasing because of surplus power and there is no need of more power and increase in demand could be met through conservation by shifting to the latest technology.

Senator Nauman Wazir stated that electric fans being used in Pakistan consume 120 watts electricity whereas other countries have introduced electric fans which consume 25-30 watts electricity. He added that developing this technology would help the country replace the existing fans and save 6,000MW electricity.

The meeting discussed issues of provision of free electricity units to existing and retired employees of power distribution companies, Neelum Jhelum hydel surcharge and health facilities provided to the employees of power distribution companies and Water and Power Development Authority (WAPDA).

On the issue of free electricity to the employees of power sector, the committee suggested monetization of free electricity and directed the ministry to come up with a proposal in the next meeting of the committee. The committee was informed that around 200,000 employees are allowed 391 million free units of Rs 5.259 billion.

The members of the committee asked the officials of NTDC and Ministry of Power to resolve load shedding issue in some areas and stated that power sector is very critical areas and there is need to rise above the politics to develop a comprehensive strategy by taking all the stakeholders on board.

The committee was briefed by the NTDC about supply of power from projects completed during 2010-2019 and other important issues of the NTDC.

The members of the committee also asked the development department of the Ministry of Power about their planning to deal with the demographic shift from rural areas to urban areas and sought a briefing from them in the next meeting of the committee about their planning with regard to power supply against the demographic shift.