KARACHI:
Pakistan is currently grappling with numerous economic challenges. One consequence of this has been inflated utility bills, which have raised anger among the masses. Inefficient and outdated infrastructure is a major reason for higher utility bills. The energy sector faces significant losses due to outdated power plants and distribution networks. This inefficiency translates into higher costs that are passed on to consumers.
Pakistan’s energy sector grapples with the burden of circular debt, which results from the mismatch between electricity generation costs and the revenue collected from consumers. This debt crisis has a cascading effect, leading to further inflation in utility bills. Corruption and mismanagement in utility companies lead to inflated bills with consumers often paying for losses incurred due to theft and misappropriation. For the average Pakistani, a significant portion of their income is allocated to paying these bills leaving less money for other essential expenses. Small and medium-sized enterprises (SMEs), which form the backbone of the economy, often struggle to sustain operations due to soaring energy costs. This, in turn, leads to job losses and economic instability. The burden of inflated utility bills falls disproportionately on low-income households.
Many people find themselves trapped in a cycle of poverty, unable to break free due to the constant struggle to meet their basic needs. Consequently, protests and demonstrations are becoming increasingly common highlighting the frustration and desperation of the people. The government must prioritise upgrading power plants and improving distribution networks to reduce losses and lower costs. Strengthening transparency and accountability within utility companies is crucial. Investing in renewable energy sources such as solar and wind can diversify the energy mix and reduce dependency on costly fossil fuels. The government must also consider implementing targeted subsidy programmes and social safety nets to alleviate the burden on low-income households.
M Abid Hafeez
Lahore
Published in The Express Tribune, August 31st, 2023.
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