KESC agreed not to cut our power: KWSB

Lawyer brings up privatization deal to argue against frequent disconnections.


Zeeshan Mujahid March 31, 2012

KARACHI: When the Karachi Electric Supply Company (KESC) was being privatised, it signed an agreement with the government that barred it from cutting off the power supply to strategic installations.

This ‘implementation agreement’ was brought up in the Sindh High Court on Friday during the hearing of a case filed by the water board (KWSB) whose electricity to major pumping stations has been suspended over unpaid bills.

The water board used the knowledge of this agreement to ask the court to intervene. Its lawyer Abrar Hasan argued that according to the “implementation order” signed by KESC, the government sold the monopoly company at a cheaper price against the undertaking that the supply to strategic installations would not be disconnected at any point in time.

He maintained that KESC had been making different demands. “Sometimes they come out with a demand of Rs17 billion and at another time with Rs20 billion,” he said. “Now they are disconnecting the power supply for four hours daily, disrupting the bulk supply to the city.”

This frequent disconnection may lead to a disaster as the water rising main would burst any time, which would cut off millions of Karachi residents for days and could lead to water riots.

Hasan appealed to the court to intervene and permanently restrain KESC from disconnecting the supply to the water board’s pumping stations. The agreement outlines a comprehensive method by which KESC can extract any bills from a strategic customer, maintained the water board. According to the deal, KESC would not demand any payments up to 2009, not take coercive action and resolve any disputes with a ‘federal adjustor.’

On February 27, KWSB was asked to deposit one billion rupees with the court and furnish a bank guarantee of Rs4 billion as part of its bill payment to KESC. “But at that time, we did not have this agreement and discovering it has changed the nature of the dispute,” Hasan said.

The court was asked to “recall, modify, alter, rescind” its order and set it aside if it deemed fit.

Justice Sajjad Ali Shah issued notices to KESC for April 6.

The KESC says that the KWSB is making “irresponsible claims” and that every consumer whether big or small has to pay their bills on time and further claim that willful default has been established on the part of the KWSB.

For its part, KESC is accusing KWSB of creating a picture for the public that water would become scarce. But the unpaid bills have created a cash flow crisis for KESC which has to buy fuel to run power generation plants. KESC says that it is KWSB’s duty to pay bills on time.

“They want riots. They want the people to take to the streets in protest,” said Misbahuddin Farid, the managing director of KWSB, as he criticised the KESC for cutting power supply to its main Dhabeji pumping station for the third time in a month.

Karachi needs 1,080 MGD of water a day. Out of this, Dhabeji pumps 580 MGD. Power cuts leads to a loss of 240 MGD.

Published in The Express Tribune, March 31st, 2012.

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