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Pakistan electricity dues pile up
Publication Date : 23-12-2013
Despite having pumped hundreds of billions of rupees to clear the circular debt build-up in the electricity sector, the government is yet to show any urgency for the clearance of a staggering Rs445 billion (US$4.5 billion) of receivables owed to electricity distribution companies across the country – jeopardising the financial viability of the entire electricity sector once again.
According to official documents available, the major chunk of Rs325 billion receivables was due from the private sector whereas the government organisations have to pay Rs120 billion to electricity companies operating throughout the country.
A government official in the power sector said that the amount was pending for quite some time and accumulating and the powerful private sector consumers had been resisting to pay it on one or another pretext.
The main reason for the government’s failure to recover the money, the official said, was political expediency. It is too early to determine whether the PML-N government would also avoid touching the influential defaulters.
A common tactic to delay payment, consumers go into litigation on outstanding bills and secure fresh connections, the official said.
Soon after assuming office, the present government paid Rs480bn to independent power producers and claimed that the payment was an attempt to clear the menacing circular debt and improve the flow of electricity in the national grid.
While the opposition in both houses of parliament cried foul recently that the money was paid to benefit IPPs owners, the circular debt has again starting building up, but the government claimed that it was because of a gap between cost and sale price of electricity.
The Quetta Electricity Supply Company leads in terms of its receivables which over the years have accumulated to Rs88bn.
The private sector has played a major role in bringing the company to its knees by refusing to pay its bills which as of October this year stood at Rs81bn followed by Rs7bn owed by the government.
The Peshawar Electricity Supply Company is the next which is also struggling to recover Rs85bn. Here too, the private sector has outstanding bills of Rs58bn against them, whereas Rs27 billion is owed by the public sector.
The receivables of the Sukkur Electricity Power Company are Rs70bn, including Rs45bn from the private sector and Rs25bn from public sector.
The Hyderabad Electricity Power Company is to recover Rs44bn, including Rs27bn from the government and Rs17bn from private consumers.
The Lahore Electricity Supply Company has Rs43bn outstanding – Rs38bn against the private sector and Rs5bn against government organisations.
The Islamabad Electricity Supply Company has to recover Rs22 from the government and Rs4bn from the private sector.
The Multan Electricity Power Company has Rs31bn outstanding against the private sector and Rs2bn against the government.
The Gujranwala Electricity Power Company is to recover Rs7bn from the private sector and Rs4bn from the public sector.
The Faisalabad Electricity Supply Company has Rs10bn receivables against its consumers of which Rs139 million is due from the government and the rest from the private sector.
US$1 = 106.2 Pakistan rupees