The caretaker government on Wednesday announced plans to tackle power theft and increase recoveries in a bid to reduce the circular debt, considered a key reason for a hike in electricity bills that has triggered nationwide protests.
Last week, the caretakers had vowed to provide relief for angry consumers, but have thus far failed to make any headway, reportedly due to the International Monetary Fund (IMF) demanding there be no deviations from budgeted allocations to ensure fiscal responsibility. In a joint press conference, caretaker Energy Minister Mohammad Ali and Information Minister Murtaza Solangi detailed measures being taken to reduce power theft, stressing this was costing the public Rs. 589 billion annually.
“We are working on an Electricity Theft Act under which we will establish the infrastructure of enforcement alongside constituting special courts to try and punish those involved in theft,” said Ali, adding a draft would be finalized within 2-3 weeks, and passed through a presidential ordinance.
The impending crackdown against electricity theft, he said, was in line with directions of interim Prime Minister Anwaarul Haq Kakar. He lamented that paying consumers had to “carry the burden of those who steal electricity,” emphasizing prices could not be reduced until theft had been curtailed.
“The background is that in our country, some domestic consumers steal electricity and others don’t pay bills,” he said, noting there were currently 10 distribution companies in Pakistan. “In every area, there are varying levels of theft and there are different percentages of recovery,” he said. Summarizing the losses of all DISCOs, he said Lahore, Faisalabad, Gujranwala, Multan and Islamabad had recorded theft of 79 billion units, amounting to losses of Rs. 100 billion against billing of Rs. 3,044 billion. Meanwhile, he continued, DISCOs in Peshawar, Hyderabad, Sukkur, Quetta and Azad Jammu and Kashmir had recorded losses of up to 60 percent.
“We have all the data on areas where electricity theft is more and where it is less, we will take steps on the basis of this data,” he said. “In areas where electricity theft is greater, we will pay more attention there and initiate a crackdown to end electricity theft,” he warned, explaining that areas with theft up to 30 percent would be tackled through technological intervention.
“Where the loss is 30-60%, we are considering whether we should involve the private sector in management,” he said, adding areas with losses over 60% required enforcement measures. He maintained the government had the “full support” of provincial chief secretaries and police chiefs for this endeavor.
According to Ali, the government also plans to improve the management of DISCOs. He said the government would forms task forces in all provinces, led by home secretaries and including energy secretaries, a federal government officer and police officers to conduct operations against electricity theft. His ministry from Islamabad, he said, would monitor these operations. “We have established a control room and developed a dashboard at PPMC [Power Planning and Monitoring Company] to manage the performance of DISCOs on a day-to-day and hour-to-hour basis,” he said. The government has also compiled a list of power distribution companies’ officers involved in power theft, he said, vowing action would be taken against them, including their removal with permission of the Election Commission of Pakistan (ECP).
To a question, the interim minister said the government was reviewing agreements with independent power producers, but stressed the capacity payments issue could not be resolved overnight and would take some time. To another question, he said the government was considering privatization of DISCOs, adding this would be determined shortly.