The Federal Cabinet of Pakistan has proposed spending Rs448 billion to implement technological measures to combat power theft and line losses. A committee assembled by the cabinet has recommended a number of actions, including spending Rs60 billion on transformer metering and Rs225 billion on a tariff differential subsidy through the Benazir Income Support Programme (BISP).
The committee claims that the energy sector’s circular debt has been significantly impacted by line losses and power theft. The committee has recommended an immediate investment of Rs38 billion for the installation of AMI metres and an additional investment of Rs260 billion for reducing power losses experienced during transmission and distribution.
The committee suggested outsourcing the management of power companies, which would cost Rs. 8 billion annually. In order to ensure competence and relevance, the committee has also suggested creating a professional Board of Directors (BoD), professional management of power distribution companies (Discos), and National Transmission & Despatch Company (NTDC). Restricting outside interference in the practical and practical activities of Discos is another recommendation made by the committee.
The committee has proposed privatising or provincializing the Discos while reconstituting their boards with technical/sector experts to address the losses incurred in the sector. In order to improve coordination among the agencies involved in the power sector, the committee has also suggested that a professional management team be appointed to the Water and Power Development Authority (Wapda) and that a central authority be identified.
The committee has suggested implementing a pre-paid metering pilot project through subsidies. Pre-paid meters for agricultural purposes are being installed at a cost of Rs 50,000 per tube well under the project. Commercial customers will pay 5% at a rate of Rs.50,000 and 95% at a rate of Rs.25,000 per connection.
Shahzain Bugti, minister for drug control, has suggested starting a pilot programme in his home district to solarize electric tube wells. In this case, the committee has recommended setting up a smaller committee with the ministers of power and commerce serving as its members and the defence minister serving as its convener.
A report on the nationwide power outage that the power division submitted has drawn criticism from the cabinet members. It was believed that the report shifted the fault to the antiquated system without holding any officials accountable for their negligence.
The cabinet members have urged the public to punish the corrupt officials who are to blame for the enormous financial costs and suffering they have inflicted on the populace.
The members of the cabinet have also brought attention to the billions of dollars that the Asia Development Bank (ADB) has pledged for the renovation of transmission lines that have been underutilised.
It has been emphasised that the energy mix needs to be changed by increasing reliance on renewable energy sources and decreasing reliance on imported fuels. The investigation committee’s findings and suggestions must be endorsed, and the regulatory authorities’ inefficiencies must be fixed. However, because there are billions of rupees at stake, the cabinet members have warned against allowing deviations from the merit order system.