PIAF stresses need for large scale structural changes in power sector


The Pakistan Industrial & Traders Associations Front (PIAF) Chairman Faheemur Rehman Saigol has stressed the need for large scale structural changes in power sector, controlling line losses of DISCOs by using modern technology, and customer-oriented business approach, as the public exchequer has incurred a loss of over Rs400 billion in the fiscal year 2022-23 by the power distribution companies.
The PIAF Chairman, quoting the media report, observed that that the performance of distribution companies (DISCOs) throughout 2022-23 remained very poor, and the expected power sector reforms were not achieved. Given the ongoing poor performance, it is apparent that, under the existing circumstances, the current DISCO setup is unlikely to be able to deliver the desired results.
No significant improvement has been witnessed on part of some DISCOs in this regard. During FY2022-23, the overall actual losses of DISCOs were 16.38% against the actual loss of 16.69% in FY 2021-22. The actual T&D losses are much higher than the allowed T&D losses for FY 2022-23, which is 12.21%. Unfortunately, the majority of DISCOs have not adhered to the NEPRA given targets, except FESCO, GEPCO, and K-Electric which have managed to keep their losses below the levels or equal to targets set by NEPRA. However, other DISCOs have exceeded these limits, which contributed to a substantial loss of over Rs. 166 billion to the national exchequer.
Faheem Saigol said that it is an undeniable fact that DISCOs are deliberately drawing less power than their demand, despite being provided with an adequate quota on account of loadshedding based on Aggregate Technical & Commercial losses policy. The AT&C based loadshedding is still being carried out and DISCOs particularly PESCO, QESCO, SEPCO and HESCO have considered it an easy path for them to manage the recovery rather than to put the efforts and ensure maximum collection.
On recoveries, the report said it is observed that only one DISCO i.e., IESCO has significantly achieved the target of 100% recovery in fiscal year 2022-23. Moreover, GEPCO, FESCO, and MEPCO are nearest to the target and achieved the recoveries of 98 to 99%. Similarly, PESCO, LESCO and K-Electric have crossed the figure of 90%. Moreover, HESCO and SEPCO remained the same as in previous year, somewhere in middle with reported values of 75.9 and 68.2%. However, QESCO has been witnessed as worst performing DISCO among all with the reported position of 36.9%.
On System Average Interruption Frequency Index (SAIFI), the report said that none of the distribution companies have been able to meet the SAIFI standard of 13. Regarding System Average Interruption Duration Index (SAIDI), the report said that almost all DSICOs are far away from the set Standard of 14 minutes.
On the issue of pending connections, the performance report said that a total of 278,815 connections were not given to the eligible consumers despite the fact that they made payments due to which more than 1100MW demand/load could not be served, which is a serious matter of concern as the ample generation capacity is available.
Loadshedding for an average of 2 to 3 hours daily is being carried out in IESCO, FESCO, GEPCO, LESCO, MEPCO and SEPCO. In contrast, PESCO, QESCO, HESCO and K-Electric have reported loadshedding duration hours 4.5 to 10.25 hours, said the report. It is further observed that distribution companies especially PESCO, QESCO, SEPCO, HESCO and K-Electric are carrying out loadshedding as per AT&C losses criteria which is not in line with the requirements Performance Standards (Distribution) Rules 2005 and has never been recognized by the NEPRA.