Aptma rejects hike in power tariff

LAHORE: The All-Pakistan Textile Mills Association (Aptma) Punjab has rejected the increase in electricity tariff and the stated that the move would deprive captive power plants (CPPs) of gas supply.

It also decided to represent the industry case before the government, besides seeking legal remedy.

The Aptma annual general meeting has already mandated the office-bearers to take necessary steps.

A detailed presentation based on published facts and figures of Nepra and other official sources was also made available on Wednesday.

He said electricity tariff for the industry has been raised by 61pc from Rs9.18 per KWh to Rs14.18 per KWh from September.

“Absorbing such an abnormal raise in tariff is impossible for paying customers of the industry,” he added.

It was further pointed out that the industry is being provided with 2170MW from Pepco network except the KESC, which comes to around 80pc of the industrial consumption. Out of it, Punjab is consuming 1800MW, followed by 145MW by Sindh and 227MW by industry in the KPK. Due to unprecedented tariff increase, the industry on Pepco network has been additionally burdened with Rs100bn. As per Nepra report, the six months weighted average generation cost of energy from hydel, RFO, gas and other sources was Rs7.61 per KWh till June 2013, followed by Rs6.76 per KWh for the months of July and August, respectively.

An abnormal increase in industrial tariff to Rs14.81 per KWh against the generation cost of around Rs7.61 per KWh is uncalled for.

It was further stated that the textile industry is predominantly export-oriented with zero line losses on independent feeders and paying 100pc electricity bills.

Also, the line losses of Punjab-based Discos are less than the Discos operating in other parts of the country, as the line losses of Lesco, Gepco, Fesco and Mepco is 12pc, 10.5pc, 10.8pc and 15pc with a recovery ratio of 96pc, 98pc, 98pc and 97pc.

The situation on ground and the approach of tackling system inefficiencies by raising tariff and punishing the efficient consumers may lead to wiping out of industry from the province of Punjab.

The energy tariff in the region is around 10 cents per KWh as against 14 cents per KWh in Pakistan. The industry cannot pass on the impact to the buyers of its products in the international marketplace.

Further, it was clarified that the industry-based captive power plants (CPPs) utilize 800mmcfd gas to generate 3200MW countrywide with average efficiency of 40pc. It will be a zero sum game if gas supply to the CPPs is taken away for generation of electricity through IPPs and Gencos and giving back electricity to the industry with 22pc line losses.