Lesco reports record power losses in April

LAHORE: The line losses of Lahore Electric Supply Company (Lesco) have reached a record level, according to the latest electricity distribution data.

The power utility lost over one-third of the electricity it received in April 2024, showing the highest power losses in the country. Despite a much-touted anti-theft campaign running for about 10 months, Lesco’s power losses could not be reduced. Instead, in April 2024, Lesco’s line losses surged to 34.7 percent, as it could only bill 1,101.27 million kWh against 1,687.46 million kWh received from the national grid, indicating a staggering loss of 586.19 million kWh. In April 2023, Lesco’s power losses had stood at 12.2 percent, as the public-sector company billed 1,656.33 million kWh out of 1,887.03 million kWh received from the national grid.

The power losses, mainly comprising commercial losses or theft of units, were significantly lower in March 2024. According to the official data, electricity losses were 9.8 percent in March 2024, reflecting a loss of 151.12 million kWh.

A third-party audit revealed that Lesco’s technical losses stood at 5.2 percent. Hence, Lesco’s reported total progressive losses of 10.9 percent for the July-March 2023-24 period indicate that nearly six percent of losses are purely due to power theft, mostly abetted by its officials. The audit suggests that a strategic opportunity exists for Lesco to reduce its commercial losses and significantly improve its financial performance. Commenting on the worrisome development, an official mentioned that the abrupt upward trend in lost units could be due to the inclusion of previously concealed, unaccounted-for power units. He recalled that several newly appointed officers of Lesco wrote letters to the CEO about the non-reporting of power units. The jump in power losses could be due to adjustments, he speculated.

When contacted, Rashid Mahmood, Federal Secretary of the Ministry of Energy (Power Division), acknowledged the existence of high electricity losses. “We are aware of the extent of the problem and have taken remedial measures to correct the management model for power distribution companies in the country,” he observed.

In the first phase, he added, new boards comprising professionals are being constituted to improve management practices in the short term. The federal government has also decided in principle to privatise power distribution companies, and the process has already been initiated under a set timeline. It may be noted that Lesco’s power distribution losses in terms of units lost are among the highest among the DISCOs in the country. As per the Performance Evaluation Report of Distribution Companies for 2022-23 prepared by the National Electric Power Regulatory Authority (NEPRA), Lesco’s transmission and distribution losses have not met the targets set by the regulator through their tariff determinations.

In contrast, Faisalabad Electric Supply Company (FESCO), Gujranwala Power Supply Company (GEPCO), and Karachi Electric (KE) have met the T&D loss targets set by NEPRA. Islamabad Electric Supply Company (IESCO) and Multan Electric Power Company (MEPCO) were closer to the target.

Chief Executive Officer of Lesco was not available for comment on high power distribution losses of the company.