Nepra vice chairman sees no visible improvement in performance of Discos

ISLAMABAD – Vice chairman of NEPRA, Rafique Ahmad Shaikh has said that no visible improvement has occurred in the performance of power distribution companies (Discos), adding that Capacity payments to IPPs and appreciation in dollar value are the major causes of hike in electricity tariff.

While briefing the NA Standing Committee on Power, Vice Chairman NEPRA, who is also member Sindh, said that the regulator supports the appointment of provincial members in the NEPRA appellate tribunal as they are the ones who protect the provincial interest.

The 15th meeting of the NA Standing Committee on Power was held under Engr. Sabir Hussain Kaim Khani, MNA in chair.

The Committee took two Bills on its agenda namely, “Pakistan Penal Code (Amendment) Bill, 2019”, and “The Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Bill, 2021” that were introduced by the government. The Ministry gave a briefing on the said Bills; however, both the Bills were deferred owing to observations raised by the Committee. The Ministry also briefed the Committee on the compliance status of its recommendations in the previous meeting. It was informed that a major chunk of the estimated expenditure in lieu of crop compensation to the landowners affected due to the projects of high transmission poles installed under CPEC Plan had been made. Nonetheless, the Committee recommended that the Ministry should compensate the leftover landowners at earliest and make the remaining payments by 2nd week of November 2021. The Committee also took notice of the issues of power shortages and persistent loadshedding in the areas of Ex-FATA. The concerned DISCO was directed to provide an inclusive solution for those areas by taking the concerned legislators on board. On a query raised by the Committee, it was apprised by the IESCO that in order to ensure that the connections were being provided to a legitimized entity, the new electricity connections in the developing areas of Federal Capital were being provided only subject to an NOC by the Capital Development Authority. The issue concerning recent increase in the electricity tariff by NEPRA and the performance of Karachi Electric was also discussed. The Committee, after considering that some of the issues required further deliberation, directed the Ministry to prepare a briefing on those points and to present a detailed report in its upcoming meeting accordingly. 

Capacity payments to IPPs and appreciation in dollar value major causes of hike in electricity tariff

Vice Chairman NEPRA said that that in the past five years, the regulator has allowed the investment of Rs 365b to nine Distribution Companies. He said that there is no improvement in the performance of Discos, adding that the burden of electricity theft is being transferred to the bill paying consumers. He said that the main causes of electricity tariff hike are capacity payments and appreciation of dollar value against Pakistani rupee. 

Regarding the constitution of an appellate tribunal against the NEPRA decision the committee was informed that it is a judicial forum where the representation of provincial nominee is not mandatory. However, Chairman NEPRA contested Secretary Power Division, that a provincial representative is required in the tribunal for the protection of the province’s interest. He said that as per the NEPRA point of view there provinces should be given representation in the appellate tribunal. NEPRA had also opposed the amendment against the provincial representation.

Secretary Power Division said the tribunal is functional since 2018, but the seats of Member Finance and Electricity are lying vacant. Sindh was supposed to provide a nominee for member finance slot of the appellate tribunal while Balochistan was supposed to furnish the name for member electricity, he added. The standing committee asked the members of the committee to provide recommendation for amendments. 

The committee also discussed the issue relating to the appointment of local people in Discos. Secretary Power Division, Ali Raza Bhutta, informed the committee that for the recruitment of local people in Discos the preparation of new framework in progress.

The meeting was attended by MNAs Sher Akbar Khan, Mehar Ghulam Muhammad Lali, Malik Anwar Taj, Mr. Saif Ur Rehman, Mian Riaz Hussain Pirzada, Syed Ghulam Mustafa Shah and Zahid Akram Durrani.

Article source: https://nation.com.pk/26-Oct-2021/nepra-vice-chairman-sees-no-visible-improvement-in-performance-of-discos