Govt plans strict power theft laws
Law to be amended to make stealing of electricity non-bailable offence.
ISLAMABAD:
After deciding to come down hard on those involved in oil and gas theft, the government is planning to treat power theft and non-payment of bills as a non-bailable offence in a bid to ensure 100 per cent collection of electricity bills, documents say.
Electricity Act 1910 will be amended to implement the proposed plan and crack down on those involved in stealing electricity and those defaulting on bill payments, they say.
The proposal comes in the face of rising electricity theft and uncontrollable inter-corporate debt. Measures to be taken under the proposal will ensure 100 per cent recovery of electricity bills, which will bring the inter-corporate debt under control.
The government is already working to treat oil and gas theft as a non-bailable offence with maximum prison term of 14 years and fine of Rs10 million, which has been endorsed by the National Assembly Standing Committee on Petroleum and Natural Resources.
Total installed power generation capacity of the country is 20,800 megawatts, but only around 14,800MW is produced due to inefficiency of power companies. Out of the total generation, an average of 24 per cent electricity is lost due to transmission and distribution losses compared to internationally accepted level of 12 per cent or less.
Under the proposal, electricity theft will invite a jail term of up to one year and fine of up to Rs500,000. Under existing laws, stealing electricity can lead to a maximum fine of Rs50,000 and imprisonment of up to two months. The proposed amendment will be tabled before parliament for approval.
In a meeting held on October 12, a high-powered energy committee recommended to the cabinet to treat electricity theft as a serious offence. The committee also proposed cutting off power connections of defaulters 45 days after non-payment and taking two-month security deposit of annual average bill collection. It also proposed linking margins of power distribution companies with collection ratio of electricity bills.
Pakistan Electric Power Company (Pepco) hardly succeeds in collecting 80 per cent of the total billed amount, causing losses to the government on account of fuel adjustment surcharge and general sales tax (GST). Some power distribution companies like those in Hyderabad and Peshawar face high transmission and distribution losses of 40 per cent.
According to documents, the government will face an annual loss of Rs130 billion in the current financial year 2011-12 because of line losses and non-collection of power bills. According to the breakdown, revenue loss will be around Rs24 billion, non-collection of bills will result in a loss of Rs82 billion and fuel price adjustments will cause a loss of Rs24 billion.
The government paid Rs151 billion as the cost of inefficiency of power companies in the last financial year 2010-11. Of this amount, Rs25 billion shortfall was due to excessive line losses, Rs26 billion was on account of late payment surcharge to fuel and power suppliers, Rs10 billion was due to GST loss and Rs25 billion was due to fuel price adjustment.
Published in The Express Tribune, October 27th, 2011.
After deciding to come down hard on those involved in oil and gas theft, the government is planning to treat power theft and non-payment of bills as a non-bailable offence in a bid to ensure 100 per cent collection of electricity bills, documents say.
Electricity Act 1910 will be amended to implement the proposed plan and crack down on those involved in stealing electricity and those defaulting on bill payments, they say.
The proposal comes in the face of rising electricity theft and uncontrollable inter-corporate debt. Measures to be taken under the proposal will ensure 100 per cent recovery of electricity bills, which will bring the inter-corporate debt under control.
The government is already working to treat oil and gas theft as a non-bailable offence with maximum prison term of 14 years and fine of Rs10 million, which has been endorsed by the National Assembly Standing Committee on Petroleum and Natural Resources.
Total installed power generation capacity of the country is 20,800 megawatts, but only around 14,800MW is produced due to inefficiency of power companies. Out of the total generation, an average of 24 per cent electricity is lost due to transmission and distribution losses compared to internationally accepted level of 12 per cent or less.
Under the proposal, electricity theft will invite a jail term of up to one year and fine of up to Rs500,000. Under existing laws, stealing electricity can lead to a maximum fine of Rs50,000 and imprisonment of up to two months. The proposed amendment will be tabled before parliament for approval.
In a meeting held on October 12, a high-powered energy committee recommended to the cabinet to treat electricity theft as a serious offence. The committee also proposed cutting off power connections of defaulters 45 days after non-payment and taking two-month security deposit of annual average bill collection. It also proposed linking margins of power distribution companies with collection ratio of electricity bills.
Pakistan Electric Power Company (Pepco) hardly succeeds in collecting 80 per cent of the total billed amount, causing losses to the government on account of fuel adjustment surcharge and general sales tax (GST). Some power distribution companies like those in Hyderabad and Peshawar face high transmission and distribution losses of 40 per cent.
According to documents, the government will face an annual loss of Rs130 billion in the current financial year 2011-12 because of line losses and non-collection of power bills. According to the breakdown, revenue loss will be around Rs24 billion, non-collection of bills will result in a loss of Rs82 billion and fuel price adjustments will cause a loss of Rs24 billion.
The government paid Rs151 billion as the cost of inefficiency of power companies in the last financial year 2010-11. Of this amount, Rs25 billion shortfall was due to excessive line losses, Rs26 billion was on account of late payment surcharge to fuel and power suppliers, Rs10 billion was due to GST loss and Rs25 billion was due to fuel price adjustment.
Published in The Express Tribune, October 27th, 2011.