KARACHI: The Karachi Electric Supply Company has categorically refuted all allegations made at a meeting of the sub-committee of the Senate’s Standing Committee on Water and Power held on Tuesday.
The KESC said on Wednesday the government had not given any bailout package to the power utility since September 2008 when the current management took over the company. On the contrary, at present the federal and provincial governments owed arrears of Rs78 billion, the company contended. It rejected the assumption that the government provided any financial relaxation to the KESC in 2009 by amending agreements, saying that from the first day of the utility’s control, the present management and shareholders had been absorbing all operational losses without passing on any burden to the government.
The KESC reiterated its stance that the government only paid the tariff differential claim that was passed on to electricity consumers on the government’s own demand. “This support to the consumers is in practice for all other power distribution companies in order to charge consumers less than the actual tariff as determined by Nepra.
“As a matter of fact, this payment of pass-through consumer tariff differential amount had adversely impacted KESC’s cash flows because the government always settled the claim after a considerable delay while the power utility had already transferred the money to consumers through monthly billing.
“Contrary to the otherwise impression created in the meeting of the sub-committee of the Senate Standing Committee, the federal and provincial governments ought to pay huge arrears to KESC; federal government entities owed Rs47 billion while provincial government entities had to pay Rs31 billion to KESC, accumulating to Rs78 billion by the current month.
“Of the receivable amount from federal government, Rs39 billion were outstanding on account of tariff differential claims alone. The arrears also included outstanding electricity bills of provincial and federal government institutions,” read a press release issued by the power utility on Wednesday.
It rejected the impression that there were any irregularities in the agreements signed with the government.
The KESC rebutted the impression that the full power generation capacity of the utility was 2,100MW, and said that after subtracting a supply of 650MW from NTDC, KESC’s net generation, including IPPs’ capacity, stood at 1,829MW. “On the other hand, the peak demand in KESC’s jurisdiction this summer is more than 2,750MW. On June 19, it was 2,778MW. Therefore, there was no way KESC could maintain its reasonable loadshedding regime without receiving supply from the NTDC,” the press release concluded.