NEPRA unveils shocking over-billing scandal by power distribution companies

The National Electric Power Regulatory Authority (Nepra) has unearthed a troubling pattern of overcharging and malpractice within the country's power distribution companies (Discos), according to a comprehensive 14-page report.

The investigation was prompted by widespread complaints from consumers regarding inflated bills during July and August 2023.

“There is [not a] single Disco in the country who is charging bills in 100% correct manner,” the regulator’s report said.

The findings reveal a systemic issue across all Discos, with none accurately charging bills. Nepra's report raises serious concerns about the entire revenue management process of these companies, spanning from meter readings to penalties.

Key revelations include discrepancies between actual user charges and meter-reading snapshots on bills. Notably, some snapshots were either missing or intentionally excluded.

Major offenders identified in consistently sending bills with invalid snapshots include Multan Electric Power Company (Mepco), Lahore Electric Supply Company (Lesco), Quetta Electric Supply Company (Qesco), and Sukkur Electric Power Company (Sepco).

The investigation also brought to light instances where consumers were billed beyond the standard 30-day billing period. This had a significant impact on "protected" consumers, those using less than 200 kWh per month for six consecutive months, who were wrongly charged at higher rates. Approximately 13.76 million domestic category consumers were billed for over 30 days, while 3.2 million faced higher rates due to extended billing periods.

Mepco led in the over-billing trend, affecting 7.99 million consumers, followed by other major Discos such as Gujranwala Electric Power Company (Gepco), Faisalabad Electric Supply Company (Fesco), Lesco, Hyderabad Electric Supply Company (Hesco), Sepco, Peshawar Electric Supply Company (Pesco), Quetta Electric Supply Company (Qesco), and Islamabad Electric Supply Company (Iesco).

The report also shed light on the alarming practice of billing consumers based on defective meters, affecting over 0.4 million users on average. Surprisingly, 492,478 meters in need of replacement were identified, with some meters remaining defective for periods ranging from two months to over three years.

Additionally, Discos have been issuing "fake and frivolous" detection bills, leading to low recovery ratios. Hesco and Sepco recorded dismal 5 percent and 6 percent recovery ratios for detection bills.

Nepra has recommended legal action against all Discos and proposed corrective measures, urging a revision of inflated bills on a pro-rata basis within one billing cycle. The Discos are required to submit a compliance report within 30 days, marking a crucial step in addressing the pervasive issue of overcharging within the power sector.

Power consumers pay extra

On the other hand, the government has been recovering a large part of the electricity subsidies from the consumers, instead of paying them from the budget.

According to Secretary Power Rashid Langrial, the government had allocated Rs900 billion for subsidies in the current fiscal year, but had paid only Rs327 billion so far. The remaining amount was being collected from the consumers through higher tariffs.

The secretary also revealed that the DISCOs in Punjab had been over-billing the consumers by more than Rs100 billion every year. He said that this was done to show lower losses and higher recoveries, and to avoid penalties from the regulator. He said that the over-billing was being adjusted in the subsequent bills, but it caused inconvenience and resentment among the consumers.