Tariff relief expected as govt completes IPPs' review: minister

• Power Minister Awais Leghari briefs Senate's standing committee.
• He says govt's task force comprehensively assessed IPPs' dues.
• Parliamentary panel discusses over-billing issue faced by masses.

ISLAMABAD: Federal Minister for Power Awais Ahmad Khan Leghari has said that the masses will get relief in electricity tariffs in the coming weeks as the the Power Sector Task Force has completed its review of Independent Power Producers (IPPs) and state-run power plants, The News reported on Saturday.

"The committee has been provided with all necessary information regarding the IPPs [...] We will soon share the good news with the public about the IPPs," Leghari said during a briefing to the Senate Standing Committee on Power.

The minister's remarks come at a time when Prime Minister Shehbaz Sharif-led coalition government is under the spotlight over sky-high electricity tariffs which have further burdened the inflation-weary masses.

Owing to the flak received regarding the IPPs, the government has been renegotiating contracts with the power produces to rein in "unsustainable" electricity tariffs — the highest in the region.

The announcement regarding relief in tariffs follows the Power Division's earlier statement on a relief of up to Rs2.65 (tax inclusive) in electricity bills for September courtesy of fuel adjustments.

Combining both the adjustments, agricultural and domestic consumers using up to 300 units would get relief of Rs2.19 per unit in their September bills, while Rs2.65 per unit (tax inclusive) would be provided to other consumers, the Power Division had said.

Expanding on the measures taken up by the government, Leghari informed the Senate committee — chaired by Senator Mohsin Aziz — that the task force had conducted a comprehensive assessment of the return on equity (ROE), operation and maintenance (O&M) costs, and outstanding dues of the IPPs.

Noting that the review also included a thorough evaluation of investment technology and associated costs for each plant, he said: "All work is being carried out with the confidence and consent of the IPPs.".

Further announcements regarding progress with IPPs will be made in the coming weeks, the minister remarked.

During the meeting, the forum addressed a significant public concern regarding electricity over-billing, brought to light by Senator Palwasha Muhammad Zai Khan in the August 30 meeting. The senator had criticised the indifference of officials to consumer grievances and shared her family’s experience of having to visit the power office 28 times in three months due to incorrect meter readings.

Senator Palwasha condemned the behaviour of officials, likening it to mafia conduct, and called for stringent action against those responsible. She proposed referring the matter to the Federal Investigation Agency (FIA) to dismantle the alleged group behind the malpractice and set a precedent for accountability.

Committee Chairman Senator Mohsin Aziz acknowledged the senator’s concerns, agreeing that the issue was of public importance and likely indicative of a broader problem, whereas a senior Power Division official confirmed that action had already been taken, including the transfer of the employee responsible for the faulty meter readings.

In response, Leghari remarked that the senator’s concerns fell under customer care, which is not directly part of electricity distribution companies.

Moving on, committee chair Senator Aziz stressed the urgent need to address electricity theft and over-billing, instructing the Power Division to clarify inconsistencies in reports regarding Bagasse-based IPPs and their tariff structures. He raised concerns over the pricing of bagasse, suggesting that its historical valuation has led to exploitation.

"We have no price of Bagasse," National Electric Power Regulatory Authority (Nepra) Chairman Waseem Mukhtar informed the committee while acknowledging that the authority determines tariffs for Bagasse-based power plants.

It is to be noted that Pakistan's eight bagasse-based IPPs, with a combined capacity of 259.28 megawatts, are operating under the 2006 power policy, with agreements set to expire between 2044 and 2049.

Additionally, the parliamentary panel also reviewed a detailed report on load-shedding and electricity distribution from Peshawar Electric Supply Company (Pesco) and Sukkur Electric Supply Company (Sepco).