Private power utility K-Electric (KE) has dismissed MQM-P’s allegations, saying that over 70% of electricity feeders in Karachi are receiving uninterrupted power supply.
KE’s remarks came after the Ministry of Energy sought details from the company in response to the allegations levelled by MQM-P about the electricity supply situation in Karachi.
Responding to a letter of the Power Division, KE rejected all allegations and said that more than 70% of electricity feeders were facing no issues and a large part of the port city was receiving power supply without any trouble.
In its letter to the Ministry of Energy, KE also outlined the operational improvements made by the company and gave an overview of its future investment plans.
About the operational mechanism for load-shedding, the company said that the issue highlighted by MNA Khalid Maqbool Siddiqui, in a letter dated June 13, 2023 and addressed to the prime minister, was for areas where electricity theft and non-payment of bills were increasing.
“The load-shedding regime applicable to this segment is purely on the basis of aggregate technical and commercial losses, ie theft and non-payment of bills by customers in that area,” the letter stated.
KE pointed out that the cost of electricity charged to customers, including KE, was determined at the federal level and any changes in end-consumer tariffs and associated taxes and fees were implemented as per directives of the government of Pakistan.
Discussing competitive markets, KE stated, “With respect to KE’s licence for the period beyond July 2023, it is submitted that KE has already filed ‘non-exclusive’ licence applications with Nepra for its distribution and supply businesses in line with the prevailing regulatory framework.”
Acknowledging the progress made by the Power Division and National Electric Power Regulatory Authority (Nepra), it emphasised that KE actively participates in conversations with both to support a smooth transition towards competitive markets and pave the way for new entrants.
However, only bulk power consumers (using one megawatt or above) are eligible under the framework for opening up of markets.
On the other hand, the customers who face load-shedding are those that have a low propensity to pay or live in low-income neighbourhoods or outskirts of Karachi (slum areas) where new entrants are unlikely to be attracted to serve such communities.
Since privatisation, the KE letter highlighted, investments of Rs474 billion have been made across the power value chain through fresh equity injections, debt, and re-investment of profits.
Operational improvements have not only benefited consumers but have also relieved the government from providing an annual operational subsidy of Rs9-10 billion, it said.
The company has also envisioned an investment of Rs484 billion, which underscores the commitment to bring operational efficiencies, make capacity additions, and provide maximum facilitation to the customers.
Last week, Federal Minister of Energy Khurram Dastgir Khan stated at a press conference that 70% of areas in Karachi were receiving uninterrupted power supply whereas the remaining 30% were subjected to load management due to low recovery and substantial line losses.
Additionally, he indicated that the ministry was formulating a policy for micro load management at the transformer level to ease the burden on consumers that paid their bills regularly.
Published in The Express Tribune, June 27th, 2023.
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