ISLAMABAD, Aug 19: The National Electric Power Regulatory Authority (NEPRA) on Monday started hearing of a petition filed by the Lahore Electric Supply Company (LESCO), seeking review of generation licenses issued to small power producers (SPPs).

The review petition filed personally by newly appointed LESCO chairman Brig Riaz Toor pointed out some glaring irregularities allegedly on the part of 29 SPPs operating in LESCO region.

Wapda’s counsel later disclosed that SPPs got the generation licenses by concealing actual capacity of their generating units. He said that most of these SPPs had also been distributing power to other industries without distribution licenses and hence causing huge losses to the government revenues.

These power generating units have been causing an estimated loss of over Rs 30 billion to the government, he said. The tariff being charged by these private producers was equivalent to that of Wapda, which also included components of general sales tax and fuel adjustment surcharge, but revenues collected under these heads had never been remitted to the government by these SPPs.

The SPPs had been operating since early 1990s when the country had been facing serious energy crisis. Most of these SPPs had been allowed to set up their own generating units by the provincial government later after the establishment of NEPRA they had been asked to get their operations regularised by getting licenses.

The industrial units permitted to set up self-generating units had also been allowed to supply additional or excessive power from their requirement to their sister concerns.

The SPPs had been granted the generation licenses but no distribution licenses had been granted by NEPRA. The power regulatory power had never asked these units to get their tariff approved despite the fact the fee for each application of tariff approval is Rs 2.5 million.

The NEPRA after initial hearing on Monday adjourned the proceeding for a day.