Regulator, energy ministry lock horns over amendment in NEPRA Act

Authority resistant to implement government’s proposal as it would affect performance of power distribution...

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) and the Ministry of Energy are locked in a row over an amendment in the Nepra Act as the former has expressed reservations saying that it would affect the performance of the power distribution companies (Discos).

Briefing the National Assembly Standing Committee on Energy, Nepra Chairman Tariq Sadozai said that they had some reservations on the amendment in the Regulation of Generation Transmission and Distribution of Electric Power Amendment Bill 2017.

Sadozai said that the regulator had taken independent decisions regarding consumers, power theft and fuel adjustments in the last few years. He revealed that Discos were unwilling to pass on the relief on account of fuel adjustment to consumers.



The chairman informed that the regulator had started monitoring over-billing but the government wanted to be informed before any action was taken against government departments.

Through the amendment in the Nepra Act the experience limit of a member was to be reduced to 10 years against the earlier limit of 15 years. However, Nepra was of the view that the limit should be maintained at 15 years, Sadozai told the meeting. He said that the regulator had no issue in implementing the government’s plan and policy but it should be kept in mind that directions were to be given to allied departments of ministries.

“If directions are given to Nepra, then there may be orders from the government to raise benchmark of transmission and distribution losses, which could lead to confrontation,” he said, highlighting the regulator’s resistance to implement such a decision.

The regulator had also objections on enforcing a uniform tariff as some power distribution companies had higher losses, he added.

Since there were more companies facing higher losses, if the government imposes surcharges on consumers to ensure uniform tariff it could affect the performance of the companies. It would also affect the privatisation plan of the power companies. The government would have to give tariff differential subsidy to bridge the difference in tariff of different companies to implement uniform tariff, the chairman explained.

The committee directed the chairman to submit his reservations in writing to the committee in its next meeting.

The committee also directed the Petroleum Division to ensure sufficient supply of motor gasoline by the Oil Marketing Companies (OMC) in the country to meet the demand. The Oil and Gas Regulatory Authority (Ogra) was asked to take up the issue of induction of oil tankers compliant with the technical standards with OMCs besides taking necessary steps for laying underground pipelines for oil transportation.



Briefing the committee on the issue of petrol shortage, Petroleum Division Secretary Sikandar Sultan Raja informed that due to lower import of motor gasoline by the OMCs during the month of August and September, shortage was reported in Lahore region, which was mitigated on a war footing basis.

He further informed that in order to meet the enhanced demand of motor gasoline and to build up healthy stocks, OMCs have been directed to import additional volumes in October, 2017 otherwise, punitive action would be taken against them.

In further developments, the committee unanimously approved the Private Power and Infrastructure Board (Amendment) Bill, 2017 without amendments. The discussion on the Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Bill, 2017 was deferred for its next meeting.

Published in The Express Tribune, September 28^th, 2017.

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