Thursday, June 4, 2009

Power tariff hike for Karachi on the cards

KARACHI: Electricity consumers in Karachi may soon be subjected to yet another tariff hike, this time of around Rs2.90 per unit, with Karachi Electric Supply Company CEO Naveed Ismail saying the move is being considered after the federal government decided to withdraw its subsidy on electricity.

Mr Ismail was speaking at the utility’s daily briefing on Wednesday.

The withdrawal of the subsidy is likely to be reflected in the government’s upcoming budget. Currently, the average per unit tariff for electricity is Rs6.55, but after the removal of the Rs2.90 per unit subsidy, it would rise to Rs9.45, he said.

He said the final decision would be determined on the basis of the KESC’s fuel costs and the cost of electricity purchased from independent power producers and Water and Power Development Authority.

The KESC CEO said that if the government subsidy was withdrawn, the National Electric Power Regulatory Authority (Nepra) would decide the new tariff and consumers would have to bear the burden.

He did not give any details regarding the KESC’s petition to Nepra regarding a quarterly tariff increase.

It is worth noting that in February this year, the KESC sought a tariff adjustment for the Oct-Dec 2008 quarter. This request was based on the contention that the utility had experienced variations in fuel costs due to fuel price variation.

Through a letter dated Feb 23, 2009, an adjustment of Rs6.754 billion was also sought, to take into account a loss in revenue due to the four per cent cap not being allowed by the authority in a previous determination for quarterly adjustment in tariff (July-September).

Mr Ismail said the first meeting of the special ministerial committee on KESC affairs was held on June 1 in the federal capital, adding that the matter of Rs13-14 billion in subsidies that the utility had not received was taken up, among other things.

The KESC CEO claimed that an average of around 22 to 24 per cent of the total electricity supplied by the KESC was being ‘misappropriated’, and a total of three million MWh had been stolen in Karachi during the last nine months from September 2008 to June this year. He said this caused both power outages and financial losses to the company.

Replying to a question, he said that a number of KESC employees had been subjected to disciplinary action on charges of involvement in electricity theft and other such allegations, and inquiries had been initiated against 138 persons.

So far, the services of 58 KESC employees have been terminated, while 20 others have been issued warnings or have been demoted.

Some 7 to 7.5 per cent of KESC consumers were on average billing, and this number should be decreased, he said. The KESC CEO said that at present 20,000 temporary hook connections were provided by the KESC to provide electricity to its new consumers.

Mr Ismail said that about 7,500 applications for new electricity connections were already present when the new management took over and about 2,500 new applications had been received.

Out of these, 6,500 cases were under process, he added.

The KESC CEO said that the utility’s transmission and distribution systems had been facing eight main cable faults in different areas, affecting electricity supply to Gizri, Federal B Area, Bahadurabad and other areas.

He informed media persons that against 2,184MW of demand of electricity at around 3 pm on Wednesday, the KESC had been doing power load-shedding of around 78 MW. The power shortfall faced by the utility was mainly due to tripping of Unit II of the Bin Qasim Thermal Power Station, he said. To meet the demand of over 2,000MW, the KESC was getting 630MW from Wapda before 3 pm. Supplies from WAPDA later surged beyond 700MW.

Meanwhile, residents of Sea View had complained that KESC staff members in Badr Commercial area were not acting to restore one phase since 1 am. Residents of many streets of Khayaban-i-Badban were also without power for several hours due unattended faults. Residents of PECHS Block II had to endure the heat without electricity after midnight. Block VI residents experienced similar problems. Parts of Gulshan and Gulistan-i-Jauhar areas around Safoora Goth were also affected.

Residents of Garden, Nishtar Road and Ranchhore Line also complained of outages at least five times during the day. They also complained that KESC staff was ‘asking for bribes’ to have unattended faults rectified. (Dawn)