Circular debt reduced to Rs12bn per month, Senate body told

ISLAMABAD: The Senate’s Standing Committee on Power was informed on Monday that the country’s circular debt had been decreased to around Rs12 billion per month from Rs34 billion.

The committee, which met with Senator Fida Muhammad in the chair, was briefed regarding budgetary allocations and its utilisation by the Ministry of Energy (Power Division).

The committee was told that an amount of Rs802 billion of the circular debt was parked with power holding companies. “Owing to timely measures, Rs134 billion was added to the circular debt in the current fiscal year. If [prudent] steps were not taken, it could have swelled to Rs300 billion.”

Taking up the issue of budgetary allocation and utilisation, the committee was informed that the budget for the current fiscal year for development projects was Rs75 billion, whereas Rs226 billion was also allocated as power subsidy.

The committee directed that there must be uniformity in tariff rates through an in-built mechanism.

The Senate panel was further informed that measures taken by Peshawar Electric Supply Company (PESCO) had helped curb the “hook culture”, while Gwadar electricity projects were delayed for three months due to the coronavirus outbreak.

Taking up the matter of outstanding dues on account of energy purchase price and indexation of 81MW Malakand – III HPS and 18MW Pehur HPS, the committee stressed the need for PEDO payments to be at par with other parts of the country.

“Levelised cost of energy must be calculated and presented to the committee in the next meeting,” the chairman maintained.

Regarding non-provision of electricity connections to the newly established industrial units in Gadoon Amazai Industrial Area, the committee was told that a network was being established to improve the situation due to which domestic consumers had to face load shedding for eight hours on a regular basis.

The Senate body was assured that this work would be completed by summers and that there would be no complaints in the future. The committee took strong notice of electricity cuts in residential areas on Sundays.

Discussing the Thar Coal Project in Sindh, the committee was informed that permission from EPA Sindh on environmental impact was imperative for commencement of all projects.

It was informed that numerous measures were being taken to facilitate the local population in Thar. “A 250-bedded hospital has been established and 24 schools are operational in areas around the project. A branch of NED University has also been established in Mithi.”

The committee, taking notice of local displacements, directed the ministry that it would like to review the policy for displacements in these areas. Electricity supply to locals was stressed as well, as Thar’s total electricity consumption stood around 1500 MW.

It was asserted that as per policy, oil, gas and electricity must be provided to inhabitants of areas nearby to the project.

Committee Chairman Senator Fida Muhammad directed that the concerned officers from the Sindh government and other stakeholders must be summoned in the next meeting.

Discussing non-provision of electricity connections to the newly established industrial units in Dargai Industrial Estate, the committee was informed that the installation of additional 1×20/26 MVA power transformer and 132kV Grid Station Dargai has been approved during December 2018.

However, there was no space available for installation of the said transformer and the WAPDA (Hydel) chief engineer was requested for the provision of land in this regard.

The meeting was attended by Senators Nauman Wazir Khattak, Sitara Ayaz, Shibli Faraz, Nauman Wazir Khattak, Muhammad Akram and Gianchand.


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