The government has failed to implement its decision of extending a support package for additional consumption of power for K-Electric’s industrial users.
The Pakistan Association of Large Steel Producers (PALSP) said in a press release that the steel industry of Karachi is the worst hit as a result of the government’s failure in implementing its decision.
According to the Association, the industrial consumers of different industries in Karachi are not getting the benefit of the “Incremental Concessionary Consumption Package” since July 2021 as compared to all other Industries located in the rest of the Country (consumers of other DISCOs).
This is blatant discrimination against the Karachi-based industry. As a result of the inordinate delay in the resolution of this matter, which is sheer discrimination, the Karachi-based members of PALSP, have moved to court on the matter, the statement added.
It explained that despite the fact that no stay has been granted by the Sindh High Court and NEPRA Appellate Tribunal’s (AT), the incremental package is not being given by KE to its eligible industrial consumers from 1st July 2021 as per NEPRA’s “Original order” and “Review Order”.
According to section 12G (5) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997, as NEPRA AT has not directed any orders suspending its decisions (Original Order and Review Order). So, the Original Order as notified by NEPRA is legally in the field, therefore, it must be complied with by KE in letter and spirit in accordance with its terms i.e., from 1 July 2021.
Earlier KE had submitted appeals to review NEPRA order No. NEPRA/R/ADG(Tariff)/TRF-100/498-500 dated January 11, 2022 (Original Order) and as a result the Review Order No. NEPRA/R/ADG(Tariff)/ TRF-100/7148-7150 dated May 27, 2022, was issued. Further NEPRA order has also been published in the official gazette SRO No. 659 (I)/2022 dated May 27, 2022(the Notification).
“It’s a great dilemma in Pakistan that the steel industry is made to run from pillar to post for getting its legitimate rights for more than a year for implementation of the govt approved and notified facility. The steel industry has knocked on every door including courts, decision/policy makers sitting in relevant ministries – but the outcome has been NIL. This may be mentioned here that Meltable scrap comprises 75% of the total cost of production, whereas [the] Electricity portion consists of 15% of the total cost for producing steel,” PALSP asserted.
According to their statement, PALSP believes that the government claims for making effort to boost the local industry as well as the economy and it were in this context that the said incremental consumption package was announced. These are good policy measures but they are not implemented, which results in severely damaging industrial development.
Right now, the steel sector is going through a tough time, and the non-availability of incremental consumption packages has added to the problems being faced by the industry. This discrimination has disturbed the level playing field and fair competition among industries located in Karachi to that in the rest of the country.
PALSP warns that if the situation continues and the facility is not enforced for KE consumers, the cost will further increase and the situation will get worse. In order to bring the Steel Industry out of the current situation, the Govt must take effective measures to facilitate the steel sector by ensuring equal facilities to the industry in every part of the country.
