Pakistan Electric Power Company (Pepco) former managing director Tahir Basharat Cheema on Thursday while addressing a discussion session organised by Lahore Economic Journalist Association (LEJA) emphasized on the need to form an advisory committee for the power sector on a similar line as the economic advisory committee.
Cheema said that such an advisory committee will help streamline policy making and consultations pertaining to the power sector.
He said that there were still issues in the IPPs’ agreements while the government was not providing any kind of financing to the sector and the sector was being asked to run its affairs on its own.
Cheema was speaking at a discussion session on ‘Energy Reforms – Increase in cost of doing business’ whereas the session was organized by the LEJA at the Lahore Chambers of Commerce and Industry (LCCI).
Cheema revealed that of all the power supply companies, Lahore Electric Supply Company (LESCO) had the highest rate of line losses and electricity units worth Rs2.7 billion of the company were being stolen.
“Overall default money of the power sector stands at Rs1.6 trillion out of which Rs1 trillion is to be paid by the private sector and Rs600 billion is to be paid by the public sector,” he said adding that the privatization of the power sector is not possible even in the next one and half decade as no government has the political capacity to accomplish this huge responsibility.
Speaking to the session the former federal secretary said that appointment of experts with vested interests and ignoring proper criteria in the name of power sector reforms was causing further increase in the energy cost which resulted in increase in cost of doing business.
“The concept of boards in the energy sector was introduced to improve the working of the power sector through policy formulation and efficiencies aimed at bringing down power generation and distribution cost. However the concept has been marred due to political appointments and appointment of non-practitioners. This has increased the cost of the distribution companies (DISCOS), rather than reducing the energy cost for the consumers,” Ali said.
He added that in the last three years the political appointees have managed to increase their fees by up to three times which has increased the expenses of the DISCOS.
“But not a single reform is happening so far. Further, the privatization of the power sector is impossible in the existence of a uniform tariff. The government has notified a uniform power tariff for all DISCOS irrespective of efficiencies and inefficiencies of different companies. During my two years tenure as secretary of the power division, the massive campaign against power theft was launched across the country which resulted in an increase in additional revenue collection which was nearly Rs260 billion,” the former secretary said.