ISLAMABAD: Caretaker Energy Minister Muhammad Ali on Friday said that the power division is working hard to reduce the electricity tariff and the work on power tariff reduction will be completed by next month.
Muhmmad Ali made this disclosure during a meeting of the Senate Standing Committee on Power which was held under the chairmanship of Senator Azam Nazir Tarar.
Speaking on the occasion, the caretaker Federal Energy Minister Muhammad Ali stated the committee that
Federal Energy Minister Muhammad Ali informed the committee that the agreements inked in the past were made in dollars and we will have to move forward with them while there is no point in talking about past the mistakes. He said we should have to adopt a strategy for improvement while considering these contracts. He said our industries cannot compete with the world according to the current rate of electricity. He said our textile industries have got 20 to 30 percent more orders which is good and we need to reduce the power cost, capacity payments while transmission lines also need more attention. He said efforts are being made to reduce the stock of circular debt. He said demand for electricity will increase if electricity rates are decreased. He said that the tariff system should have to be made more effective while subsidies have to be removed and legal changes have to be made in this regard. He said private sector experts have to be included in this system. He said that there is a need to pay attention to the management of power distribution companies (DISCOs). There are problems for the industry on the current electricity rates, the electricity rates for industry in Pakistan are up to 16 cents while in other countries these rates are up to 9 cents, said Caretaker Energy Minister Muhammad Ali.
The Standing Committee was also briefed in detail about the working procedures and performance of the Power Division. The committee was told that the work was being done under the rules of business. Power Division has 7 wings and number of sanctioned posts is 183. With a budget of 485 million, there are total 102 development projects out of which 66 are ongoing and 36 are new projects.
Officials of power division while briefing the Senate Standing Committee on Power informed that there are 12 organizations working under the Power Division. The committee was informed that there is an installed capacity of about 45,000 MW, of which 28percent is from hydro, 16pc from coal, 11% from gas, 17% from RLNG, 19% from nuclear, 1% from coal and 1% power generation is with solar source.
Responding to the question of the Chairman Committee, power division’s officilas informed that power is being generated according to the demand of electricity and 12400 Megawatt (MW) of electricity is being generated on an average during the winter season and the effective operational capacity is about 23000 MW.
Senate Standing Committee on Power was also informed that the circular debt doubled in the year 2018 and stood at Rs 450 billion while it increased by Rs 560 bln in 2019 and Rs 538 bln in 2020. It was also informed to the senate committee that efforts will be made to maintain the circular debt up to Rs 2310 billion in 2023-24. Steps are being taken to use future technology, said officials of power division.
The officials of power division further told the Senate Committee on Power that under the new policy, there will be no capacity charges, as only energy generation charges will be the part of power tariff. World’s best solar system will be established in the Balochistan province, said Power Division’s officials.
Senator Bahramand Khan Tangi said that if electricity is generated through hydro-solar and wind, then circular debts can be got rid of.
Senator Saifullah Sarwar Khan Niazi said that there is a need to adopt a better and workable policy regarding solar in the country, which can bring improvement in the system.
Senator Dilawar Khan said that new agreements should be made in Pakistani currency instead of dollars.
The Senate Committee was told that efforts are being made to reduce the installed capacity. The electricity demand in summer season is 30,000 MW in summer season and 12,000 MW to 13,000 MW in the winter season.
Senator Bahramand Khan Tangi said that if the demand is 12400 MW and we have the capacity to generate electricity, then why is there load shedding in the country. On which it was informed that load shedding is done at the feeder where the losses are high.
Chairman Committee Senator Azam Nazir Tarar said that unless the energy basket is fixed, improvement is not possible and no investor will invest here. We should examine the system of neighboring countries to improve our system.
The Senate Committee was informed that recovery of Rs 52 billion has been made till December 2023, while 35,000 people were arrested, 63,000 cases of power theft registered while Rs113 billion are to be obtained from the provincial governments. Good support is getting from the present government.
In attendance, Senators Fida Muhammad, Dilawar Khan, Saifullah Sarwar Khan Niazi, Zeeshan Khanzada, Sana Jamali, Haji Hidayatullah and Bahramand Khan Tangi, the caretaker Federal Minister of Energy Muhammad Ali, Additional Secretary Ministry of Energy and high officials of related institutions attended the meeting of the Senate Committee on Power.
