The government has decided to enact stricter policies towards those involved in stealing electricity, with the water and power ministry proposing jail terms of up to one year and fines of up to Rs500,000.
The measure was proposed during a meeting on Thursday chaired by Water and Power Minister Naveed Qamar to discuss with power distribution companies the ways in which they can improve their efficiency and begin recovering uncollected bills, another serious problem for electricity companies. Under current laws, stealing electricity can result in a maximum fine of Rs50,000 and imprisonment of up to two months. The proposed amendment would have to be passed by parliament.
Theft from the national grid is a major reason for the electricity crisis in the country, with some power companies losing up to 40% of the power they produce to line losses, causing them to suffer financially and crippling the entire energy chain.
Many power companies try to build in their losses into the tariffs they charge their customers but the National Electric Power Regulatory Authority (Nepra) limits the degree to which this is allowed, forcing the power companies to operate on losses. There are currently nine power distribution companies in the country, eight of which are state-owned and none of which make a profit or break even.
The government has recently tried to deregulate electricity pricing, though the measure has yet to take effect. In 2011, the most recent fiscal year, the government spent close to Rs300 billion on subsidising the power sector, a cost that government officials feel they cannot bear again.
A variety of measures were discussed at the meeting, including possible incentive schemes for the employees of power distribution companies. The firms themselves were asked to submit detailed plans for reducing their line losses.
The minister also reviewed progress on the recovery of the power sectors’ receivables, noting that while 90% of the target was achieved, much work remained to be done. He suggested that the power companies conduct a survey of people who have thus far refused to pay their bills to ascertain if they were stealing electricity from the grid even after suspension of their power supply.
Published in The Express Tribune, July 8th, 2011.