Circular Debt Soars to Rs. 2.5 Trillion

The Senate Standing Committee on Power has been informed that the circular debt of the power sector has reached up to Rs. 2.5 trillion.

The committee, which met here on Friday with Senator Saifullah Abro in the chair, was briefed by chairman National Electric Power Regulatory Authority (NEPRA) Engr. Tauseef Farooqi that out of total electricity generated in the country, 65 percent is produced by coal and 35 percent through hydel; however, in recent few months the price of coal has increased internationally from $50 to $400.

Chairman NEPRA also remarked that currently, consumers are charged Rs. 24 per unit and the price would have been doubled without the generation of hydropower.

The senate body was also apprised about the expenditure of different boards of directors (BoDs) for attending meetings and other expenses incurred in this regard. Additional Secretary Power Division Arshad Majeed apprised members that BoDs are awarded Rs. 60,000 per meeting plus Rs. 2,500 under hotel expenses.

CEO Gujranwala Electric Power Company (GEPCO) Muhammad Ayub stated that GEPCO has reduced the allowance of BoDs for attending the board meeting from Rs. 60,00 to 35,000. Senator Saifullah Abro appreciated the CEO’s initiative and recommended that all other DISCOs should do the same.

The committee also discussed the public petition regarding the rehabilitation and energizing of the grid station in the coastal town of Garho, Sindh. Officials of Hyderabad Electric Supply Company (HESCO) stated that the aforementioned project is under HESCO’S five-year plan and it will cost around Rs. 3.5 Billion.

HESCO officials further added that the petitioner Dr. Ghulam Haider Shah, a resident of Thatta, plans to sell solar energy to residents of the area and demanded the construction of 30 kilometres transmission line from HESCO. Senator Saifullah Abro maintained that the said project is not feasible and decided to inform him about the committee’s decision in writing.

Senator Saifullah Abro also raised objections to the appointment of Sardar Jamal Khan Leghari as Chairman of BoDs of Multan Electric Power Company (MEPCO). He claimed that besides being the son of the former President of Pakistan, what qualifications this person has. He recommended the ministry to provide details of membership with the Securities and Exchange Commission of Pakistan (SECP) of all newly appointed BoDs of different DISCOs.

In the previous meeting of the committee, Senator Abro had recommended that BoDs of all generation companies (GENCOs) shall be dissolved. Officials of the Power Division informed that the ministry is planning to implement the scheme of 2012 under which all GENCOs will be merged and managed by one CEO and Board of Directors.

The meeting was attended by Senator Haji Hidayatullah Khan, Senator Zeeshan Khanzada, Senator Kamran Murtaza, Senator Danesh Kumar, Additional Secretary Power Division Arshad Majeed, Chairman NEPRA Tauseef Faroqi, CEOs of different DISCOs and other concerned officials.