ISLAMABAD - The Supreme Court on Tuesday inquired from the National Electric Power Regulatory Authority (NEPRA) how it had worked out the formula for the determination of new power tariffs.
A three-member bench of the apex court, headed by Chief Justice Iftikhar Muhammad Chaudhry, expressing dissatisfaction over the NEPRA’s procedure about the determination of power tariffs sought complete record of public hearing along with NEPRA’s October 11 notification regarding the recent increase in power tariffs and also issued notice to Attorney General for Pakistan in this regard.
Justice Gulzar Ahmad, a member of the bench, made it clear that NEPRA’s recent notification about raising power tariffs had no legal backing. The bench raised a question that how the NEPRA could increase power tariffs without giving opportunity to the stakeholders to participate in the process.
The court also suggested the chairman NEPRA to engage a counsel in this case because they would give a judgment regarding the process about determination power tariffs.
During the hearing, Chairman NEPRA Khawaja Naeem failed to satisfy the bench about the procedure in determining the power tariffs.
The chief justice asked the chairman NEPRA that how could the government intervene in NEPRA affairs. He said that the process about determining the power tariffs should be transparent as they would not allow monopoly of anyone in this regard.
The court said if the government did not want to give subsidy on electricity then it was upto to it, but prima facie it seemed that the government was only helping the IPPs through subsidy. He said that they would examine whether the power tariffs could be fixed on the basis of discretion, adding this is an inappropriate manner of doing things.
The CJP also observed that the government had put all the burden of line losses to the consumers, who were paying electricity bills regularly. He said that the government must take people onboard while fixing power tariff, otherwise, people would raise questions on the government’s practice of simultaneously undertaking loadshedding and hiking the tariff.
The Chairman NEPRA told that NEPRA always determined the power tariffs of companies differently as IESCOs was the most sufficient company; therefore its tariff rate was low. He also admitted that the government was providing subsidy to the inefficient companies.
Chairdhry Naeem also informed that 30 to 40 percent consumers were using less then 50 units and the government was receiving two rupees per unit from them.
Meanwhile, MD PEPCO Zargham Ishaq Khan told the bench that the total power generation at present at peak hours was 13000 mega watts while 12800 mega watts was on off peak hours. He however, said that the required power generation is 14300 mega watts at peak hours.
Referring to the recovery of outstanding electricity dues, Zargham Iskah Khan told the court that every distribution company was required to recover the outstanding dues. When the Chief Justice asked him as who refuses to recover the outstanding dues, Zargham replied that there are different consumers.
The MD PEPCO further said that at present some Rs 460 billion is outstanding for recovery of electricity bills including Rs 280 billion of private sector. He however said that the Industrial sector appeared as the good paymaster adding that about 92 percent recovery is being made from the Industrial sector while commercial sector recovery is 85 percent and domestic consumers is 75 percent. He further said that numerous ways are being adopted for the recovery of electricity bills.
The bench asked him that why was the government not deducting at source the value of power theft in each province from the share in the divisible pool of the National Finance Commission (NFC) Award. Upon this, he replied that provinces had refused to accept this proposal.
Regarding the issuance of illegal CNGs licenses, the court again directed the Director General FIA to submit inquiry report on the next date of hearing. Likewise, the FBR told the bench that out of 3495 CNG stations, 1869 were paying taxes.
The hearing of the case was adjourned until November 6.
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