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ISLAMABAD: The World Bank has asked the government to reverse its decision of placing 16 corporate power sector companies under the control of Wapda chairman or else it would stop funds for various projects.
Secretary Water and Power Sikandar Ahmed Rai told the senate standing committee on water and power led by Zahid Khan that the World Bank had reacted over the recent government decision to put power companies under the control of Wapda chairman Syed Raghib Shah and written to the government to reverse the decision.
He said the bank had also warned that it would block funds for various power sector projects if the decision was not withdrawn.
The power sector reforms were initiated in early 1990s under a World Bank funded restructuring plan to separate Wapdas water and power wings and then unbundling of power wing into distribution, generation and transmission companies.
The bank had provided more than $4 billion in financial assistance since the unbundling process was set into motion in 1992.
Mr Rai told the committee that the decision to appoint Wapda chief as central coordinator for the power sector was taken with the approval of the president and the prime minister to avoid February 24-like breakdowns in future that plunged the entire country into darkness.
He said the power sector faced tremendous challenges as the system faced a shortfall of about 4,500MW on Thursday, leading to forced shutdown as demand crossed 13,000MW mark against 8,600MW of power supplies. Therefore, emergency decisions had to be taken to avoid crisis over the next couple of months.
He said the ministry of finance would be releasing Rs5.5bn immediately under directives of the president to ensure sufficient furnace oil stocks to sustain generation over the next four months.
In view these circumstances, the chairman Wapda had been designated as central coordinator for the power sector to ensure discipline as chief executives of power companies had started behaving like viceroys.
Notwithstanding, the World Bank concerns, the government has to cope with immediate challenges of urgent nature so that power system could be sustained and run smoothly for three to four months, he said.
The newly-appointed secretary water and power also spoke against gas supplies to captive power plants (CPPs) of All Pakistan Textile Mills Association that he said were inefficient.
On a question from Senator Maula Bakhsh Chandio of PPP, the secretary said the CPPs of textile mills were running round the clock on natural gas and the ministry had made efforts to divert this gas to more efficient power plants of independent power producers and Wapdas generation companies but failed.
We are providing uninterrupted gas supply to textile sectors CPPs by causing deprivation to the people, he said adding the load-shedding could be reduced by 5-6 hours a day if gas being provided to inefficient CPPs was diverted to IPPs that have been lying idle for many months.
He said soon after taking over as secretary water and power he took up the matter with secretary petroleum for diversion of gas from CPPs to IPPs and Wapda plants who said the gas supply to textile mills had been taken at the highest level. He requested the committee to help the power ministry in withdrawing gas from CPPs to the power sector.
Senators Chandio and Humayun Khan Mandokhel said the textile mills had started power production as their main business and were selling their electricity to distribution companies at higher rates even though their own power plants were lying idle because of gas shortage. They asked the power ministry to investigate the matter and give a detailed presentation to the senate panel.
Senator Zahid Khan said the parliamentary committees had more powers than the president and the prime minister and its decisions on diversion of gas to power sector would have to be implemented by the government but the committee has to be presented with facts before expecting it to take decisions.
Senator Ghafoor Haidri protested that Balochistan was being provided only 350MW of electricity these days even though it used to get 650MW about 10 years ago. The secretary water and power said the problem was because of Karachi Electric Supply Company as it was drawing more than 650mw from national grid.
The committee asked the ministry to submit a report whether Kesc was required under the agreement to run its plants to full capacity and then draw electricity from national grid and noted with concern that the privatized utility had closed down its own plants and relying on national grid.
Secretary Water and Power Sikandar Ahmed Rai told the senate standing committee on water and power led by Zahid Khan that the World Bank had reacted over the recent government decision to put power companies under the control of Wapda chairman Syed Raghib Shah and written to the government to reverse the decision.
He said the bank had also warned that it would block funds for various power sector projects if the decision was not withdrawn.
The power sector reforms were initiated in early 1990s under a World Bank funded restructuring plan to separate Wapdas water and power wings and then unbundling of power wing into distribution, generation and transmission companies.
The bank had provided more than $4 billion in financial assistance since the unbundling process was set into motion in 1992.
Mr Rai told the committee that the decision to appoint Wapda chief as central coordinator for the power sector was taken with the approval of the president and the prime minister to avoid February 24-like breakdowns in future that plunged the entire country into darkness.
He said the power sector faced tremendous challenges as the system faced a shortfall of about 4,500MW on Thursday, leading to forced shutdown as demand crossed 13,000MW mark against 8,600MW of power supplies. Therefore, emergency decisions had to be taken to avoid crisis over the next couple of months.
He said the ministry of finance would be releasing Rs5.5bn immediately under directives of the president to ensure sufficient furnace oil stocks to sustain generation over the next four months.
In view these circumstances, the chairman Wapda had been designated as central coordinator for the power sector to ensure discipline as chief executives of power companies had started behaving like viceroys.
Notwithstanding, the World Bank concerns, the government has to cope with immediate challenges of urgent nature so that power system could be sustained and run smoothly for three to four months, he said.
The newly-appointed secretary water and power also spoke against gas supplies to captive power plants (CPPs) of All Pakistan Textile Mills Association that he said were inefficient.
On a question from Senator Maula Bakhsh Chandio of PPP, the secretary said the CPPs of textile mills were running round the clock on natural gas and the ministry had made efforts to divert this gas to more efficient power plants of independent power producers and Wapdas generation companies but failed.
We are providing uninterrupted gas supply to textile sectors CPPs by causing deprivation to the people, he said adding the load-shedding could be reduced by 5-6 hours a day if gas being provided to inefficient CPPs was diverted to IPPs that have been lying idle for many months.
He said soon after taking over as secretary water and power he took up the matter with secretary petroleum for diversion of gas from CPPs to IPPs and Wapda plants who said the gas supply to textile mills had been taken at the highest level. He requested the committee to help the power ministry in withdrawing gas from CPPs to the power sector.
Senators Chandio and Humayun Khan Mandokhel said the textile mills had started power production as their main business and were selling their electricity to distribution companies at higher rates even though their own power plants were lying idle because of gas shortage. They asked the power ministry to investigate the matter and give a detailed presentation to the senate panel.
Senator Zahid Khan said the parliamentary committees had more powers than the president and the prime minister and its decisions on diversion of gas to power sector would have to be implemented by the government but the committee has to be presented with facts before expecting it to take decisions.
Senator Ghafoor Haidri protested that Balochistan was being provided only 350MW of electricity these days even though it used to get 650MW about 10 years ago. The secretary water and power said the problem was because of Karachi Electric Supply Company as it was drawing more than 650mw from national grid.
The committee asked the ministry to submit a report whether Kesc was required under the agreement to run its plants to full capacity and then draw electricity from national grid and noted with concern that the privatized utility had closed down its own plants and relying on national grid.
