Expensive electricity: Daily oil bill of thermal power plants is Rs2b

PEPCO chief tells court that generation companies owe Rs113b to PSO.

ISLAMABAD:

The federal government on Thursday told the Supreme Court that more than Rs2 billion was being spent per day to buy 25,000 tonnes of furnace oil to run thermal power plants.

The furnace oil bill for thermal power plants has climbed to around Rs749 billion a year, Managing Director Pakistan Electric Power Company (Pepco) Zarghoon Ishaq Khan said. Khan was addressing the queries of a three-judge bench headed by Chief Justice Iftikhar Muhammad Chaudhry who has taken suo motu notice of unrelenting power outages in the country.

“This Rs749 billion is in addition to Rs250 billion being spent in terms of subsidy to certain consumers by selling them electricity below the cost price,” said the Pepco MD.

The bench, also comprising Justice Gulzar Ahmed and Justice Sheikh Azmat Saeed, expressed its surprise that despite spending a huge amount on thermal generation, an end to power cuts was not in sight.

All the power generating units are producing around 9,200 MW of electricity per day against a demand of 13,800 MW, Khan said.

He said that different power generation companies owe Rs113 billion to the Pakistan State Oil from where they buy on credit the furnace oil for thermal power generation.

He said that different independent power producers (IPPs) were also getting a less supply of gas by 250 million cubic feet.

Published in The Express Tribune, May 3^rd, 2013.