At a high-level meeting in Karachi on Tuesday, August 17, presided over by the Chairman of the Investment Facilitation Board of Sindh, Brigadier Akhtar Zamin, and attended by the Director General of Board of Investment Akhlaq Ahmed, KESC Managing Director Brigadier Saddozai, President Karachi Chamber of Commerce and Industry (KCCI) Siraj Kasim Teli, Site Managing Director Hashim Raza Zaidi and Site Association Chairman Nisar Shekhani, it was reportedly decided that the Nepra would be approached by the Sindh Investment Facilitation Board shortly to seek rationalisation of electricity rate charged by Wapda from the KESC.
It was noted that Wapda was charging Rs 3.70/kWh from KESC which was 24 paisa higher than the rate of Rs 3.46 charged by Wapda from Lesco, Fesco and Hesco. The issue was raised by the KCCI requesting the Board of Investment to bring down the electricity rates by Wapda to KESC by 24 paisa kWh.
It is indeed highly disturbing to note that Wapda has been overcharging the KESC so far in excess of the rate charged to other power distribution companies in the country.
There appears to be hardly any reason for Wapda to justify its higher rate to KESC which in turn has placed the consumers in Karachi, specially industrial consumers, at a disadvantageous position. As a result, the industries in Karachi are forced to sustain higher cost of production than the similar industries in other areas of the country.
It would appear that the power consumers in Karachi are facing a two-prong onslaughts in so far as the power supply is concerned. Firstly they have been forced to put up with frequent power breakdowns of long duration and secondly they have to pay higher rates for electricity than other consumers in other areas of the country.
Wapda's power generation cost is considerably on the low side due to the fact that a substantial portion of its power generation is based on hydroelectricity to which the latest addition is Ghazi Brotha Power Project. Additionally, the Chashma Nuclear Power Plant is also adding energy which is produced at a much cheaper cost.
The KESC's generation cost is substantially on the higher side due to the fact that most of its power generation facilities depend heavily on fuel oil. Thus the KESC's own power supply is costlier to consumers in Karachi. The overcharging by Wapda definitely constitutes an unbearable addition to the heaps of problems faced by the KESC.
The Karachi Chamber of Commerce and Industry has rightly activated the Board of Investment to redress the problem of high cost of energy which is indeed the foremost impediment in the way of further industrial investment in Karachi.
The city, by its own right, is the largest industrial centre of the country contributing to a major portion of export earnings besides providing employment to thousands of industrial workers. It would be expected that the Nepra would examine the proposed request from the Sindh Investment Facilitation Board to reduce Wapda's rate by 24 paisa on its sale of electricity to KESC as early as possible. An explanation from Wapda in justification of its high charges to KESC may come into light during the Nepra's hearing on this issue.
The meeting also considered some other complaints from the industrial consumers of electricity. One of the complaints that KESC was recovering additional charges from the industrial consumers for shifting their meters from inside to the outside of the premises, was clarified by KESC Managing Director Brigadier Saddozai.
According to him no charges in this connection would be recovered and even the earlier payments by some industries, would be refunded. This would be described as a welcome accommodation from the KESC to the complaints of industrial consumers.
He also pointed out that only 2 percent of the total industrial consumers constitutes those presented with average electricity bills which, he promised, would be reduced to zero at the earliest.
The understanding shown by the KESC Managing Director would be appreciated by all concerned.
The meeting convened by the Investment Facilitation Board to discuss the problem relating to power supply in Karachi, to the industrial consumers in particular, is undoubtedly a welcome initiative in this direction. The need for such meetings can hardly be overlooked if seen in the context of investment promotion in Karachi.