KESC warned of ‘harsh measures’

[EagleEyes]

KESC warned of ‘harsh measures’

ISLAMABAD: The government has decided to issue a final notice to the management of the Karachi Electric Supply Company (KESC) against its repeated failure to improve performance.

Talking to reporters after a meeting of the Cabinet Committee on Energy Crises here on Saturday, Water and Power Minister Raja Pervez Ashraf said the ministry was waiting for the KESC response to a Nepra show-cause notice and if there was an unsatisfactory reply and the company failed to improve its generation and distribution network the government would be compelled to take ‘harsh measures’.

‘We cannot nationalise the KESC, but the government has majority stakes in it and can appoint a new management,’ he said.

Mr Ashraf said it was the responsibility of the utility to ensure regular supply of electricity to consumers.

‘Such prolonged outages are severely disturbing the civic life and losses to business and industrial activities have been enormous.’

He said his scheduled visit to Karachi had been postponed because of a cabinet meeting on Monday and the new date would be finalised soon.

The meeting was informed that an energy efficiency fund was being set up with the assistance of the Asian Development Bank to enhance generation and distribution capacity of the energy sector.

A national energy strategy is also being formulated to utilise bio-mass and waste of energy resources and to increase the overall generation capacity.

The minister said that 1,200MW would be added to the national grid this month to ease the overstretched distribution system.

Sources said that power generation units had complained that PSO was not cooperating with them and supplies of furnace oil were not regular.

Pepco and Genco officials informed the meeting that under-repair plants were being brought online and 3,600MW would be available from newly-commissioned plants by the end of this year.

They said that Pepco was trying to enhance generation capacity through multi-dimensional generation strategy and conventional hydel and thermal sources.

Other alternative energy options were also being tapped to optimise electricity generation, they added.

The meeting was informed that many countries, including France and China, had shown interest in energy sector projects.

DAWN.COM | Pakistan | KESC warned of ?harsh measures?

 

[muse]

Perhaps, Yet another "political" problem:

Load shedding is political

Sunday, July 26, 2009
Dr Farrukh Saleem

Why is Lahore out of power for 12 hours a day?

Answer 1: Japan Power Generation Limited located at Jia Bagga Railway Station, Raiwind Road, District Lahore, is shut down. Japan Power's 24 residual furnace-oil diesel power-generator sets of 5MW each for a total of 120MW are all shut down.

Answer 2: Southern Electric Power Company Limited, located near Raiwind, is shut down. Southern Electric's six residual fuel oil diesel engine generators of 23MW each for a total installed capacity of 135MW are all shut down.

Solution: Settle political disputes; switch on Japan Power plus Southern Electric and Lahore shall have electricity for at least 20 hours a day.

Benazir Bhutto came out with her Power Policy 1994, under which investors were free to propose the site, technology and fuel. There was exemption from corporate income tax, sales tax, Iqra and custom duties. Benazir's Power Policy was an outstanding success. AES Lalpir, AES Pak Gen, Attock Gen, Fauji Kabirwala, Gul Ahmed Energy, Habibullah Coastal, Japan Power, Kohinoor Energy, Liberty Power, Rousch Power, Saba Power, Southern Electric and Tapal Energy collectively invested some $3 billion and added around 3,000MW worth of generation capacity.

Nawaz Sharif came out with his Power Policy 1998. It was a complete failure. Pervez Musharraf came out with his Power Policy 2002. Under Musharraf's Power Policy, Attock Gen is the only IPP (independent power producer) that has-just recently-been commissioned (capacity: 165MW).

The PPP government has now promised that there shall be "no load-shedding by end-December 2009." But the proposed Atlas Power, Nishat Power, Ruba Energy and Reshma Power are all oil-based. Orient Power, Sapphire Power and Saif Power are gas/dual-fuel. AES and Mitsui are coal-based and their expected COD is June 2013.

Wapda has bought electricity worth Rs65 billion from IPPs, but it has no money to pay them. Wapda has bought oil worth Rs22 billion from oil marketing companies but has no money to pay them. Wapda, PIA and IPPs have bought oil from PSO but now have no money to pay PSO. PSO has bought oil worth Rs62 billion from Parco, National Refinery, Attock Refinery, Pakistan Refinery and Bosicor Refinery, but now has no money to pay the refineries.

Wapda owes Rs21 billion to PSO, Rs37 billion to Hub Power and Rs25 billion to Kapco. PIA owes Rs3 billion to PSO and PSO owes Rs30 billion to Parco, Rs10 billion to Pakistan Refinery, Rs9 billion to Attock Refinery, Rs8 billion to National Refinery and Rs5 billion to Bosicor Refinery.

FATA owes Pepco a colossal Rs80 billion and FATA has no money to pay anyone. Pepco, the Pakistan Electric Power Company, has been supplying electricity to the federal government, the provincial governments, KESC and KW&SB but neither the governments nor their entities have any money to pay Pepco. That in essence is the Rs200 billion circular debt.

However, Budget 2009-10 has allocated Rs1.2 billion for Prime Minister Gilani's foreign tours, Rs390 million for "presidential staff, household and allowances," Rs230 million for the president's foreign tours, Rs645 million for "travelling, conveyance and air tickets" for our MNAs, and Rs7 billion for the "constituency development" of our legislators. The Government of Pakistan has some seven-dozen ministers or VIPs with the rank of minister. The governments of Punjab, Sindh, Balochistan and the NWFP put together have around 12-dozen more ministers and ministerial-rank VIPs. Each one of them cost us Rs100,000 a day.

Japan Power and Southern Electric are political issues. Hardly any other IPP is operating at full capacity. While the Pakistani government is failing to run the already installed capacity, it wants to buy expensive rental power. The federal and provincial governments have truckloads of money to spend on their ministers, but don't ever pay their electricity bills. Load-shedding is political.


The writer is the executive director of the Centre for Research and Security Studies (CRSS). Email: farrukh15@hotmail.com

 

[muse]

Editorial: Power crisis and power politics

The Federal Water and Power Minister, Raja Pervaiz Ashraf, says that the power tariff will go up by Rs 3 when the government withdraws the subsidy on electricity in line with a commitment made to the International Monetary Fund (IMF). His argument is that the average electricity generation cost is Rs 8.37 per unit while the average selling price is Rs 5.37 per unit, the difference translating into a hefty subsidy.

Mr Ashraf doesn’t say when the new tariff will come into force but everybody knows that this means bigger bills despite long hours of load shedding. But his other statement should come as good news for the people of Karachi: the National Electric Power Regulatory Authority (NEPRA) will take over the management of the Karachi Electric Supply Company (KESC) if the latter can’t show that it can handle the job after a show-cause notice. (Let it not be like the undoing of the privatisation of the Steel Mills from where the state is now picking up a loss of Rs 20 billion annually.)

Regarding the steel-ball of the circular debt tied to the foot of his government, the minister claimed that more than half of it had been paid off and that only Rs 70 billion remained, which “will be paid soon”. He may have also stubbed his toe when he added — unnecessarily perhaps — that “the defeat of the Pakistan Muslim League-Quaid in the general elections of 2008 was a result of severe load shedding in the country during the party’s tenure”.

The truth is that people who are rioting in the streets of Pakistan don’t think the PMLQ is to blame for load shedding; they think the PPP government is responsible for not sorting out the crisis. The “awami” argument given is not that the crisis is inherited but that the government is spendthrift when it comes to its own expenditures and niggardly when it comes to spending on the increasingly miserable plight of the common man. TV anchors insult the ruling politicians by boasting that they (the TV anchors) don’t have air-conditioners and UPS facilities in contrast to the politicians who drive around in expensive air-conditioned cars and have exempted their houses from load shedding. The print columnist insists that load shedding is political rather than an “inherited” economic crisis. This is how the case is being made against the government: Budget 2009-10 has allocated Rs 1.2 billion for Prime Minister Gilani’s foreign tours, Rs 390 million for “presidential staff, household and allowances”, Rs 230 million for the president’s foreign tours, Rs 645 million for “travelling, conveyance and air tickets” for our MNAs, and Rs 7 billion for the “constituency development” of our legislators. The government has some seven dozen ministers or VIPs with the rank of minister. The governments of Punjab, Sindh, Balochistan and the NWFP put together have around 12 dozen more ministers and ministerial-rank VIPs. Each one of them cost us Rs 100,000 a day.

Although all this is a fraction of the Rs 70 billion owed under the head of circular debt, it is enough to make the opposition politicians quiver with excitement. Somehow it doesn’t arouse the same collective wrath followed by rioting in India where the power gap is 70,000MW and load shedding is endemic and no less uncomfortable. In fact, if the government there is making sacrifices for the sake of Indian industry, the suffering of the domestic consumer must be more severe.

The crisis may be inherited but the prospects of it being resolved — in December 2009 or any time later — are complicated by the fact that electricity production will be oil-fired and will be expensive. Someone has to take the rap for the existing lack of consensus on other sources of power, especially hydro, where regionalism takes over and the national public weal is ignored. The gas from Iran is jeopardised by internal disorder; and coal from Sindh, late to come on line by ten years, could get more delayed because of a centre-province jousting over red tape.

The unavoidable fact is that whoever comes to power — it could be the PMLN after possible mid-term elections caused by load shedding! — will face the same “inherited” problem. It is therefore advisable not to politicise load shedding but think collectively about it without partisanship.

 

[fatman17]

Electricity cuts feed anarchy across country

* Mobs burn tyres, throw stones nearly everyday in Karachi, parts of Punjab
* 83% say they are affected by rolling blackouts, heat

KARACHI: Away from the killing fields between the army and the Taliban, violent riots triggered by power outages engulf the country, underscoring the government’s weakness.

Burning tyres and throwing stones, mobs rampage daily in Karachi, where the first monsoons brought 8.6 centimetres of rain, killed over 30 people and brought power transmission to a virtual collapse.

Riots have been even worse in Punjab, where mobsters held up a train in Jhang, ordered passengers onto the platform and set three coaches on fire.

“At least 25 of our public dealing offices have been attacked, our employees have been beaten and many vehicles burnt,” said Naveed Ismail, an official of the Karachi Electricity Supply Corporation.

“Such attacks on our facilities delay restoration work as it makes staff afraid to go to affected areas for repairs,” he said.

Pakistan faces a severe energy crisis and is able to produce only 80 percent of the electricity it needs, suffocating industry, making life unbearable in extreme winter and summer, and causing widespread civil disturbance.

It is a topic of debate from the richest suburbs to the most miserable slums. Even US Special Envoy Richard Holbrooke peppered praise for action against the Taliban with the need to address the crippling cuts.

Production shortfall has been blamed on the government’s incapacity, corruption, short sightedness, debts, a creaking distribution system, lack of money to invest in renewable energy and growing demand making the crisis worse every year.

“I’m a college student, I’ve never fought with anyone in my life but I can’t stop myself,” said a young man, angrily pelting stones at police in Karachi’s Ranchhore Lines.

“Anyone with no power and water supplies non-stop for three days would be angry,” he said.

Poll: According to a recent Gallup Pakistan poll, 53 percent of the population go without power for more than eight hours a day and a massive 83 percent say they are affected by rolling blackouts and the heat.

Another 42 percent are forced to terminate work during the day because of the blackouts and only 11 percent can afford generators or standby batteries.

The government has taken out advertisements appealing for public restraint. Prime Minister Yousuf Raza Gilani ordered the government to “work out immediate measures to redress the situation” but admitted it was out of his hands.

“We are trying to improve the situation but it is not a commodity that I can buy and give to the people,” Gilani said.

The outages hammer an already flailing economy.

afp