The Standing Committee on Power on Monday was informed that circular debt has reached Rs.2.28 trillion during the fiscal year 2020-21, mainly due to the unpaid government subsidies which have resulted in the accumulation of debt on distribution companies.
The committee which with Chaudhry Salik Hussain in the chair, discussed circular debt and other issues.
The Ministry reported that the circular debt has doubled despite increase in the tariff since July, 2018. It was further told that power tariffs were determined by NEPRA. Tariffs for Power Generation Companies were governed by power purchase agreement, which defined the base tariff for power generation as well as the process for subsequent adjustments. Tariffs revision was thus automatically reflected in power purchase prices. NEPRA only validates the past claims of power supplier.
Chairman of the Standing Committee Chaudhry Salik Hussain observed that it was a high time, the agreements should be re-negotiated with IPPs and the consumers should be given relief in the electric bills.
He said that the resolution of circular debt was necessary as this would ease supply constraints.
The Committee members suggested that recovery might be done through revenue department and incentives could be given on recoveries.
The Committee also set up four members Sub-Committee under head of Lal Chand to discuss and recommend for resolving the issues faced by the legislators with respect to Karachi Electric Comply (KE), DISCOs and GENCOs of Sindh. Other members of the sub-committee were included Syed Ghulam Mustafa Shah, Engr. Sabir Hussain Qaim Khani and Ms. Saira Bano.
The meeting was attended by MNAs Mr. Sher Akbar Khan, Ms. Ghulam Bibi Bharwana, Mr. Saif Ur Rehman, Mr. Lal Chand, Engr. Sabir Hussain Qaim Khani, Ms. Saira Bano, Mian Riaz Hussain Pirzada, Mr. Zahid Akram Durrani, Syed Agha Rafiullah, Secretary, Ministry of Power Division along with senior officers of the relevant departments.
