Circular debt of power sector crosses Rs800b

Islamabad: Circular debt in the power sector has reached Rs800b according to Pakistan Electric Power Company (Pepco).

It was shared in a recent meeting of the Economic Coordination Committee (ECC) that recoveries had improved from 88-89pc in 2014 to 93pc for 2015 and 2016. Line-losses also went down from 19pc in 2014 to 17.8pc by December 2016.

Water and Power Secretary, Yousaf Naseem Khokhar commented that due to fall in line-losses and improvement in recovery had helped the power sector to generate a positive inflow of Rs116b in last two years.

Lower global oil prices contributed to the restriction of the circular debt within levels of Rs320-330b from December 2014-June 2016, the ECC was told. Power generation companies were able to generate a profit of Rs5.77b during 2015-16 from total losses of Rs7.78b in 2013-14.

The earlier reported figure in February of circular debt was said to be Rs685b which now had risen beyond Rs800b according to PEPCO. This cumulative circular debt is to be held by various distribution companies and Power Holding Limited.

According to officials, this figure of circular debt is at tolerable levels, as it also includes old stock as well a fresh collection in the last few months.


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