The Lahore Chamber of Commerce and Industry (LCCI) has severely criticised the 39 per cent per unit increase in electricity tariff under the monthly fuel adjustment formula and urged the government to withdraw the hike and direct the National Electric Power Regulatory Authority (Nepra) to freeze the tariff at least for one year for the sake of the economy.
The LCCI President Irfan Qaiser Sheikh in a statement on Thursday said the government in collaboration with the private sector would have to evolve a mechanism to cap the electricity prices for a term or a period so that the industrial consumers could calculate the cost of their finished products.
He said that the existing draconian Nepra method to raise electricity tariff by issuing a single notification for millions of its consumers is not only unjustified but unethical as well. He said that there was a time when a businessman calculates Return on Investment keeping in view the two factors; the cost of electricity and the cost of raw material but now it is very unfortunate that even local investor has no idea of the prices of the electricity because Nepra keeps on adding various components in power tariff and that too with retrospective effect.
Irfan said that only last year the Nepra while doing away with subsidy factor introduced two per cent equalisation charges in electricity bill to wear off the impact of line losses. And the equalization charges were fixed at two per cent but now suddenly and without any information to the commercial consumers the rate of Equalization Charges has been raised to four per cent.
He said that the Lahore Chamber understands well and a staunch believer that the economic turnaround would remain a dream unless and until all institutions have realisation of causes hitting the very economic fabric of the country. He said that at this point in time when the industry in Punjab was getting no gas, productions have nose-dived and industrial growth is decreasing instead of any increase, an unprecedented upward trend in the prices of electricity is bound to keep the economy hostage for years to come.
Irfan said that it is common phenomenon that in unusual circumstances, routine working methodologies are shelved and special measures are adopted to get rid of economic meltdown but in Pakistan the situation is the other way round. He also criticised Nepra for notifying another increase in electricity prices saying that it would prove last nail in the coffin as both the trade and industry were already suffering due to huge increase in electricity prices in the last five months.
He said that all the power distribution companies should be directed to determine their respective electricity tariff on basis of line losses. For instance, if the line losses in one Disco are bigger than the other the power tariff in that particular Disco should more than the other. He said business community was surprised that instead of taking measures to control line losses and enhance cheap power generation up to capacity, the policies are being evolved to add to the miseries of the business doing people.
He said that industrial sector was passing through a critical time of its history. A large number of industrial units had already closed down their operations due to acute energy shortage. He said that situation needs measures but the policy makers are doing the other way round. He said that Pakistan had already lost a number of international markets and the decision to increase power tariff would make the Pakistani goods more uncompetitive. He demanded that fuel adjustment formula should also be revamped as it is hitting the consumers hard.