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Thursday Dec 07 2017

'K-Electric purchased costly electricity, charged consumers additional Rs14.4bn


ISLAMABAD: K-Electric, the sole power distributor in Karachi, burdened consumers by purchasing electricity at higher rates and received an additional Rs14.4 billion from them, audit officials told the Public Accounts Committee on Thursday.

Chairman Khursheed Shah presided a meeting of PAC, which discussed a number of issues pertaining to overbilling by power companies, power generation by different plants and load-shedding.

The PAC directed the Ministry of Power Division, NEPRA to address the issue of overbilling by reducing whooping line losses as Rs200 billion was being recovered from honest consumers.

The meeting, held to review audit objections of the year 2016-17, noted that all power distribution companies (DISCOs) were overbilling consumers to compensate for their losses.

During the meeting, the chairman asked Water and Power secretary and NEPRA chairman to reduce technical losses and overcome four per cent electricity theft being recovered from bill-paying consumers unjustifiably.

MNA Sheikh Rashid questioned as to why honest consumers were being billed for the electricity they did not consume.

At this, Secretary Power Division Yousaf Naseem Khokar told that measures were being taken to address the issue. He said the officer responsible for overcharging consumers would be sentenced to three years imprisonment.

The PAC was told by the auditors that Rs28.183 billion losses were incurred during 2016-17 owing to underutilisation of power plants.

"All IPPs and GENCOs were supplying electricity to the Central Power Purchase Agency (CPPA) on take or pay basis," they said.

"Under take or pay agreement, CPPA is bound to purchase all available electricity from the power plants for idle capacity as well."

The auditors noted that despite the demand for electricity in the system, IPPs and GENCOs power plants were not used to their full capacity.

"Due to plant underutilisation, the consumers of electricity, on one hand, faced 8-12 hours load-shedding, while on the other this underutilisation increased the electricity tariff due to payments made on account of take or pay agreement."

Khokar said the ministry was pursuing a vibrant strategy to overcome line losses.

Expressing dismay over the absence of K-Electric's CEO despite summons by PAC, Shah said the CEO must attend the PAC meeting on December 20.

In case of failure, strict action will be taken against him, Shah warned, pending the K-Electric audit paras until next meeting.


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