LAHORE: Former prime minister Shahid Khaqan Abbasi Tuesday said the truth associated with the power sector was not being told to the people.
Speaking at a panel discussion organised by the Institution of Electrical and Electronics Engineers Pakistan here, the Awam Pakistan Party leader and former prime minister emphasized that Pakistan was actually facing the problem of under-utilization of the power production capacity.
He said as many as Rs1,900 billion worth of capacity charges per annum had been accumulated, which translated into around Rs18 per unit out of the total cost of a kWh. About two-thirds of the capacity charges were made to government-owned power plants, he added.
“When these power plants were established, dollar exchange rate was around Rs100. Had this rate of nearly Rs100 been maintained, there would have been only Rs03 per unit amount added to the tariff on account of capacity payments instead of Rs18,” he observed.
“Similarly, power consumption has been stagnant over the years, putting strain on the viability of power sector. We were producing about 90 billion units per year several years back which increased to 143 billion units per annum. It was a big jump, showing 50 percent surge in electricity generation.”
But, in the last couple of years, the power production reverted to 115 billion units, he said, adding that low generation of electricity was one of the problems the nation was facing today.
So, the real problem is that we, not the IPPs, destroyed the economy. In fact, the IPPs did not destroy the economy but power generation companies took a hit from the ailing economy. Now you must have understood how the decisions of the country are made. The matter needs to be understood. Instead of focusing on the real issues, we terminate the contract of IPPs. There is a breach of promise by the government; it intimidates the IPPs management. How will investors come?
