A dangerous game

K-P government believes that it is currently subsidising electricity costs for the rest of Pakistan.

Editorial December 29, 2013
What the provincial government really wants is for K-P to get cheaper electricity and for the rest of the country to pay far more than it currently does. PHOTO: FILE

For a party that claimed to be different from its predecessors, the Pakistan Tehreek-e-Insaf (PTI) is remarkably adept at playing the old game of grievance politics. Under the guise of demanding provincial rights, the PTI-led Khyber-Pakhtunkhwa (K-P) government seems set to embark on a path of confrontation, not just with the federal government, but with the other three provinces as well. The PTI’s demand that all power generation, transmission and distribution resources in K-P be handed over to the provincial government

is not sensible, one that is likely to spark inter-provincial tensions that the federation can do without. While we support devolution of more authority to the provinces and believe that it is reasonable for the provinces to demand that the energy sector be handed over to them for regulation and management, the reason the K-P government is demanding that it be handed over those is more than just a simple demand for greater provincial autonomy.


What the provincial government really wants — something that PTI leaders have been openly telling their constituents — is for K-P to get cheaper electricity and for the rest of the country to pay far more than it currently does. The province is currently the location of much of Pakistan’s hydroelectric production capacity, which of course, is the cheapest form of electricity in the country. The cheaper production cost of hydroelectric power is the reason why electricity bills in Pakistan are much lower than they would be had the dams in K-P not existed.

The PTI wants to ensure that consumers in the province are given access to that cheap electricity — and pay only for the cost of generating hydroelectricity — while the rest of the country pays for much more expensive thermal electricity. Effectively, the K-P government believes that it is currently subsidising electricity costs for the rest of Pakistan and wants to stop the deal. There are many, many reasons why this view is seriously mistaken, and the K-P government would be well advised to drop this demand.

Firstly, there is the very nature of hydroelectricity: it is very seasonal, producing far more in the summer than in the winter months. Yes, K-P would pay far less for its electricity in the summer, but it would also lose about half its electricity supply in the winter. In those months, the province currently relies on electricity produced from natural gas in Sindh and Balochistan, and power plants based in Punjab. The harsh reality for K-P is that it is nowhere near energy independent. The deal it currently has with the rest of the country works for a reason: yes, K-P pays higher prices, but it also gets a more consistent supply of electricity. And when it comes to electricity, the K-P government is far from innocent victims of an overbearing federal government. While it is true that Islamabad owns the utilities in the province, those utilities also have the second-worst line loss rate in the country (topped only by Balochistan), and responsibility for the enforcement of laws against electricity theft lies firmly with the provincial government. Indeed, the federal government has offered to turn over the management of the Peshawar Electric Supply Company (Pesco) to the provincial government if it so chooses, but the PTI has been saying that it would be meaningless without also being given management over power generation capacity.

We believe that in this case, the federal government’s demand is perfectly reasonable: show yourself capable of running the toughest part of the electricity system (distribution) before asking to manage the easiest part (generation). If Pesco only had to pay for hydroelectric power, its profit margins would be so large that it would have absolutely no incentive to take any action against electricity theft. That would be tantamount to a subsidy for people who steal electricity in K-P, paid for by law-abiding citizens everywhere, including those in other provinces. In the name of provincial rights, the PTI is effectively asking for a freebie. The party should be careful in making such demands. Its voters in other provinces are unlikely to take kindly to higher bills for no reason.

Published in The Express Tribune, December 30th, 2013.

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ooh | 9 years ago | Reply

Awesome! Everyone is fighting over scraps!

Hassan Hakeem | 9 years ago | Reply

If they want Pti govt of KPK can purchase Tarbela Dam from the people of Pakistan (through Federal govt) including Land, equipment & human resource each of which was purchased by the people of Pakistan including every inch of land. Pti should concentrate on grand theft electricity going on in its jurisdiction & work on putting up its own power plants.

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