Special courts to try electricity thieves

Caretaker govt announces its intent to amend Electricity Theft Control Act through an ordinance

ISLAMABAD:

The caretaker government has taken a crucial step towards addressing the persistent issue of power sector losses and a growing circular debt by announcing amendments to the Electricity Theft Control Act through an ordinance. The move aims to establish special courts dedicated to curbing electricity pilferage.

Caretaker Energy Minister Muhammad Ali, accompanied by Interim Information and Broadcasting Minister Murtaza Solangi and Energy and Power Division Secretary Rashid Mahmood Langrial, confirmed the development during a news conference in the federal capital.

The circular debt in Pakistan had surged to Rs2.536 trillion by December 2022, with an alarming increase of Rs343 billion in the current year alone, primarily attributed to the inefficiencies of the previous government. The energy minister emphasised that power pilferage posed a substantial challenge to Pakistan, resulting in annual losses estimated at Rs589 billion.

“This means that consumers who pay their bills are effectively subsidising those who steal electricity,” he said, adding that the government would take a two-pronged approach to tackle the electricity theft.

The minister maintained that in areas where theft is low, the government would intervene through technology, and install smart meters and transformers, whereas where theft is high, enforcement measures would be taken such as raiding illegal connections and prosecuting offenders.

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He stated that the government planned to privatize or provincialize the distribution companies (Discos). This would allow the government to focus on policy and regulation, while the private sector or provincial governments will be responsible for managing the Discos, he said.

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He said a taskforce would be set up that would work in cooperation with the Energy and Power Division secretary, IGs, commissioners, and deputy commissioners at the grassroots level to curb power pilferage.

He also announced to introduce reforms in 10 Discos, noting that five low performing Discos were facing losses worth Rs100 billion where recovery of electricity bills was extremely low due to poor management.

The energy minister pointed out that companies in Peshawar, Hyderabad, Quetta, Sukkur, tribal areas, AJK, Mardan, and Shikarpur faced a deficit of Rs489 billion.

He said special courts would be set up to deal with cases of electricity theft through ordinance.

Speaking on the occasion, the caretaker information minister rejected the impression that any minister was receiving free electricity.

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He announced that the Power Division would crack down against those involved in power theft after the inquiry held them responsible for “human and technical error”.

Solangi also ruled out introducing any law beyond the constitutional mandate of the caretaker government and observed that power pilferage was a key factor that was contributing to rise in electricity rates in the country.

He pointed out that the annual power theft in Pakistan stood at Rs589 billion and called for introducing reforms in the energy sector.

As the circular debt that has plagued the entire energy chain, the government plans IPOs (initial public offerings) for three efficient power distribution companies, the power secretary said.

These power distribution companies include Islamabad Electric Supply Company (Iesco), Gujranwala Electric Power Company (Gepco) and Faisalabad Electric Supply Company (Fesco).

“We have to move on to privatization,” he said, adding that the government was “seriously considering” for an IPO for these three companies.

These three power distribution companies are considered to be most efficient where losses are low and recovery of bills is higher.

The previous governments had made serious efforts to privatize the power distribution companies but they did not yield any results.

Pakistani business tycoon Mian Mansha had expressed interest in acquiring Fesco but the deal could not be materialized.

Due to serious issues in power sector especially the circular debt, the investors were not willing to participate in the deal.

The multilateral donors including the International Monetary Fund (IMF) had been stressing Pakistan to privatize the power distribution companies.

The previous government had even chalked out plans to split the power distribution company but were unable to do so.

Now, the caretaker government is also considering handing over the power distribution companies to the provinces. However, this is the old wine in a new bottle as the interim setup announced to establish special courts through amendments in power theft control act.

All these plans were earlier chalked out by the previous governments but could not materialize.