pkpatriotic
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Tuesday, May 06, 2008
ISLAMABAD: The energy crisis-hit Pakistan may face further aggravated scenario with the emergence of unsettled disputes between the key stakeholders directly involved in the process of electricity provision to the end consumer.
"The country is poised to face even the worst kind of power shortage as almost all the major entities -- part of the process -- have lodged complaints against one another with the Centre to settle these serious issues," official sources told The News on Monday.
The Independent Power Producers (IPPs) are extending threats to the Pakistan Electric Power Company (Pepco) for suspending power generation and exercising the last option of recovering their due amounts by getting government guarantees cashed, the sources maintained while giving one of the examples.
"Obviously, they are to extend threats when their due amounts are piling up with the passage of time and Pepco is unable to discharge its cash liability due to various reasons," one of the top Pepco officials, Tahir Basharat Cheema, confirmed to this correspondent when contacted.
The Hubco, the major power generation and supply company, is amongst the IPPs that have formally asked the Pepco to pay its arrears on the account of purchasing power as the Pakistan State Oil (PSO), on other hand, is pressing them (IPPs) for clearance of furnace oil charges.
"The PSO, after getting a cold-shoulder response from the Centre, has substantially reduced the furnace oil supply, ultimately further reducing the power generation," an official source at the Petroleum Ministry said when contacted.
"The PSO, that has a huge sum to recover from the IPPs as well as from the Pepco, is presently supplying not more than half of what is demanded," the same source said. Reduction in furnace oil supplies, reduced water flows and dispute over payments by the stakeholders can further aggravate the electricity availability in the country already hit by severe crisis with the people bearing 4-5 hours load-shedding in urban areas and up to 10 hours, or even more in some places, in the rural areas.
"The exact situation is that the IPPs are very much close to the point where they resort to getting the government guarantees cashed and we have explained the exact position to the government," Cheema, who is also spokesman for the Pepco, said.
He said the company is facing trouble in managing the payments to the IPPs and the PSO mainly due to the its consistently increasing arrears against the Karachi Electric Supply Company (KESC), Federally Administered Tribal Areas (Fata) and the government departments besides on account of tariff deferential claim.
The KESC's total dues have surged to the tune of Rs 42 billion, Fata arrears stand at Rs 74 billion, Rs 12 billion are against different government departments and Rs 120 billion are under the head of tariff deferential (difference between the international market and the rates on which the furnace oil is supplied to the companies). "All the IPPs are being dealt under the power purchase agreements with them," Cheema said.
On the question of power tariff increase, the Pepco official said the government or the end consumer would have to bear the extra charges due on account of the electricity rates. "Pepco is supplying electricity throughout the country on the rates when the furnace oil rate was Rs 30,000 per ton whereas its present cost is Rs 44,000 per ton, so there is a huge difference that will have to be absorbed either by the government or the consumer," he added. The Pepco had sought Centre's help in recovering receivables and the scenario can play a devastating impact on the power generation after the PSO has substantially reduced the furnace oil supply.
The PSO, that served notices on all power generation companies that have yet to pay their dues on account of furnace oil, approached the Petroleum Ministry some ten days back, seeking release of Rs 58 billion from companies and other government departments on the head of price deferential claim. "But there is no progress as yet."
The Water and Power Ministry and Petroleum Ministry conveyed to the Finance Ministry the concerns of Pepco and PSO as well as expected scenario at a time when the country is already badly suffering due to the electricity crisis.
ISLAMABAD: The energy crisis-hit Pakistan may face further aggravated scenario with the emergence of unsettled disputes between the key stakeholders directly involved in the process of electricity provision to the end consumer.
"The country is poised to face even the worst kind of power shortage as almost all the major entities -- part of the process -- have lodged complaints against one another with the Centre to settle these serious issues," official sources told The News on Monday.
The Independent Power Producers (IPPs) are extending threats to the Pakistan Electric Power Company (Pepco) for suspending power generation and exercising the last option of recovering their due amounts by getting government guarantees cashed, the sources maintained while giving one of the examples.
"Obviously, they are to extend threats when their due amounts are piling up with the passage of time and Pepco is unable to discharge its cash liability due to various reasons," one of the top Pepco officials, Tahir Basharat Cheema, confirmed to this correspondent when contacted.
The Hubco, the major power generation and supply company, is amongst the IPPs that have formally asked the Pepco to pay its arrears on the account of purchasing power as the Pakistan State Oil (PSO), on other hand, is pressing them (IPPs) for clearance of furnace oil charges.
"The PSO, after getting a cold-shoulder response from the Centre, has substantially reduced the furnace oil supply, ultimately further reducing the power generation," an official source at the Petroleum Ministry said when contacted.
"The PSO, that has a huge sum to recover from the IPPs as well as from the Pepco, is presently supplying not more than half of what is demanded," the same source said. Reduction in furnace oil supplies, reduced water flows and dispute over payments by the stakeholders can further aggravate the electricity availability in the country already hit by severe crisis with the people bearing 4-5 hours load-shedding in urban areas and up to 10 hours, or even more in some places, in the rural areas.
"The exact situation is that the IPPs are very much close to the point where they resort to getting the government guarantees cashed and we have explained the exact position to the government," Cheema, who is also spokesman for the Pepco, said.
He said the company is facing trouble in managing the payments to the IPPs and the PSO mainly due to the its consistently increasing arrears against the Karachi Electric Supply Company (KESC), Federally Administered Tribal Areas (Fata) and the government departments besides on account of tariff deferential claim.
The KESC's total dues have surged to the tune of Rs 42 billion, Fata arrears stand at Rs 74 billion, Rs 12 billion are against different government departments and Rs 120 billion are under the head of tariff deferential (difference between the international market and the rates on which the furnace oil is supplied to the companies). "All the IPPs are being dealt under the power purchase agreements with them," Cheema said.
On the question of power tariff increase, the Pepco official said the government or the end consumer would have to bear the extra charges due on account of the electricity rates. "Pepco is supplying electricity throughout the country on the rates when the furnace oil rate was Rs 30,000 per ton whereas its present cost is Rs 44,000 per ton, so there is a huge difference that will have to be absorbed either by the government or the consumer," he added. The Pepco had sought Centre's help in recovering receivables and the scenario can play a devastating impact on the power generation after the PSO has substantially reduced the furnace oil supply.
The PSO, that served notices on all power generation companies that have yet to pay their dues on account of furnace oil, approached the Petroleum Ministry some ten days back, seeking release of Rs 58 billion from companies and other government departments on the head of price deferential claim. "But there is no progress as yet."
The Water and Power Ministry and Petroleum Ministry conveyed to the Finance Ministry the concerns of Pepco and PSO as well as expected scenario at a time when the country is already badly suffering due to the electricity crisis.
