October 30, 2001	Tuesday	Shaba'an 12, 1422

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ISLAMABAD, Oct 29: Facing a cash deficit of Rs35 billion, the Wapda would not be paying this year Rs20 billion debt service liability to the federal government and around Rs6 billion hydel profit to the NWFP.

Senior Wapda sources told Dawn that the federal government has been informed about the utility’s financial situation and its inability to clear the two vital liabilities. They, however, said any fresh proposal for tariff increase has neither been discussed at the Wapda level nor submitted to the National Electric Power Regulatory Authority so far.

Having paid over Rs55 billion to the NWFP in 10 years, the Wapda has already delayed first quarterly instalment of around Rs2 billion to the province of hydel profit dues.

“Normally, we make hydel profit payments to the NWFP on a quarterly basis. We have not paid first instalment of around Rs2 billion which fell due in September,” said a Wapda official.

Sources in the finance ministry said that federal government would take necessary measures to deal with this situation but admitted that non-payment of hydel profit to the NWFP would upset its development and other budgetary targets.

He said that the finance ministry would adjust some public sector dues against Wapda and then pay to the NWFP government. But this will also clear Wapda’s books, said the official.

Last year, the federal government had converted Wapda’s Rs36 billion debt into equity because of the utility’s cash shortfall.

Under the A.G.N. Qazi formula, the Wapda is required to pay around Rs6 billion to the NWFP as hydel power profit. “As of June 30, 2001, the Wapda has cleared every penny to the frontier government but this year it is not possible,” said the Wapda official.

The Wapda sources also agreed that the NWFP and the power utility had differences over the calculation of hydel power profit. Auditor General of Pakistan has authenticated the Wapda calculations, these sources claimed.

Official figures available with Dawn suggest that the Wapda had paid Rs6 billion against Rs4.8 billion estimated by the AGP and Rs4.1 billion calculated by the Wapda in 2000.

The figures worked out by the AGP and Wapda hovered around Rs5.8 billion and Rs3 billion during 1995 to 1999 but the NWFP was paid a fixed sum of Rs6 billion every year.

Meanwhile, the Wapda sources disclosed that the 11 paisa per unit increase allowed by the Nepra on Oct 19 under the automatic fuel adjustment formula was not based on Wapda’s petition and Nepra had announced the determination on its own.

A senior Wapda official also revealed that no fuel-based tariff increase was required under the utility’s calculation for the period between June and September, 2001. However, a 13-paisa per unit increase was required when calculations were made for the remaining portion of the current fiscal year based on an anticipated 8 per cent inflation factor.

The official said that the utility had sent a petition for 13 paisa per unit increase for the full year but before the petition could reach Islamabad, the Nepra came out with 11 paisa per unit increase. “The Nepra decision came as a surprise because we got the increase even before our petition reached Nepra,” said the official.