Line losses: Govt to set targets for power distribution companies

DISCOs will have to target 1 to 1.5% reduction in losses per year.

ISLAMABAD:

With power distribution companies facing an average of 24% transmission and distribution losses every year, the government is considering setting a target of reducing these losses by 1 to 1.5% per year.

The internationally accepted average is 12%.

In ongoing financial year, government will face revenue loss of Rs24 billion due to line losses and Rs24 billion loss on fuel adjustment due to line losses. “Rs7 billion can be saved if line losses are reduced by 1 per cent in a year,” an official of Ministry of Water and Power said adding that a high level meeting will be held today (Thursday) to discuss the issue.

However, the official said huge investment will have to be made to bring about this reduction.

“We want to assign task to distribution companies (DISCOs) to indentify the worst hit areas,” the official said adding that during the meeting power distribution companies would also be asked for details of the power sector financing by Asian Development Bank (ADB) and World Bank.

Meanwhile, a presentation on proposed Economic and Despatch Model in order to improve the efficiency of the power sector was given by USAID to the Federal Minister for Water and Power, Syed Naveed Qamar.

The Minister said outsourcing of public sector plants, construction of mega dams and hydel projects and measures to change the energy mix for cheaper energy, ending of circular debt, reduction in line losses and recovery of outstanding dues are major policy parameters of the government to improve this sector. He said that ministry will further study the proposed Economic Despatch Model.

The main focus of the presentation was power system analysis, Economic Despatch and fuel requirements, generation mix and financial impact of Despatch Model and related issues. The presentation was made by Bob Collins, Adviser Technical, Hammad Amir Hashmi, Adviser Technical and also attended by Muhammad Bashir Assistant Adviser Technical and Asad Chohan Chief Reporting Officer.

Published in The Express Tribune, February 9^th, 2012.