Karachi Electric Supply Company has appreciated the assurance by Chief Secretary Sindh to pay the dues of water board in the next few days and thus, KESC has reconnected power supply to Dhabeji pumping station. Power supply to the station was disconnected on Saturday morning for non-payment of Rs 16.69 billion after the government-run water board failed to make the payment despite a seven-day final notice for payment of at-least Rs one billion.
It is important to note here that board had failed to even pay its monthly power dues in-spite of the decision taken in this regard in a meeting held at Governor's House. KESC said that despite non-payment of the dues, power to the water-pumping station has been restored on the commitment of the government. He demanded payment of entire outstanding amount without further delay.
KESC said that the KWSB consumes electricity worth Rs 35 crore (350 million) every month but has not been responding positively to pay its bills in the interest of water needs of the metropolis. On the other hand, KESC has constantly been strained with respect to its cash flows due to the burgeoning receivables, the leading outstanding of which Rs 16.69 billion is receivable from KWSB alone. These constraints have been making it increasingly difficult for the power company to keep its payments regular to strategic partners like SSGC against its gas purchase bill.
This has brought both KESC and SSGC under the burden of circular debt. KESC had last week served final notice upon KWSB to pay at least Rs one billion in seven days or face disconnection. The board did not oblige but for paying a meagre 10 per cent, Rs 100 million.
The board has a history of habitually defaulting on its monthly power bill for a long time. During the past four months, it paid only Rs 15 crore, while its outstanding bill accumulated from Rs 15,706,713,192 in November 2011 to Rs 16,694,106,248 in January 2012. As against that, the board paid Rs five crore in November and Rs 10 crore in February in violation of its commitment made during the meetings held at Governor's House.
KESC stated that the release of the outstanding payments owed to it by KWSB would aid to a great extent in making or forwarding those payments to SSGC on account of the monthly gas purchase. Hence, it is hoped that KWSB dues would be paid directly to SSGC to offset payables by the power utility to the gas company. It expressed hope that the first step in this case with respect to one-billion rupee notice, would be the clearance of the remaining Rs 900 million which can be forwarded to SSGC.-PR