KARACHI: No end to outages as KESC mortgages power plant
By Shamim-ur-Rahman
KARACHI, April 22: While the citizens have braved the suffocating heat without an uninterrupted power supply for many summers now and local industries are up in arms against the utility’s foreign management, the Karachi Electricity Supply Corporation has for the third time mortgaged its premier but troubled Bin Qasim thermal power plant to secure a $125 million loan, apparently to enhance its generation capacity.
Insiders told Dawn that at a meeting scheduled for Monday the crucial question regarding the dwindling power generation capacity of the KESC and the perpetual problem of the worn-out distribution network would be raised. The meeting, which will be chaired by Minister for Power Liaquat Jatoi, is likely to take note of the blame game between the Water and Power Development Authority and the KESC for the continuing power outages.
The business and industry sector has taken strong exception to the frequent and unwarranted incidents of power failure and hours-long load shedding.
It has noted that 30,000 shopkeepers of over 350 large markets, 15,000 factories in five industrial towns, hundreds of thousands of small and cottage industries spread over 18 towns of the metropolis and over 18 million inhabitants are suffering because of the inefficient working of the KESC, which even after privatization is not able to increase power generation to meet the electricity requirements of Karachi.
The president of the Karachi Chamber of Commerce and Industry, Majyd Aziz, was furious about the power crisis and demanded that in the planned meeting, responsibility should be fixed and Siemens should be strongly penalized for what he termed as an “illegal and conspiratorial action.”
He said that Saboor Ahmed, Chairman of the Public Sector Utilities, Power and Gas Sub-Committee, KCCI, in a communication to Mr Sohail Wajahat H. Siddiqui, Managing Director, Siemens (Pakistan) Engineering Co., held Siemens responsible for the frequent incidents of power failure and load-shedding in the city.
KCCI proposed that Siemens bring to Karachi a 210-megawatt power plant erected on a barrage and provide free electricity to the KESC so that some relief is made available to the consumers until a new plant is installed by the power utility.
Mr Aziz pointed out that at a press conference in July 2006, the KESC’s then managing director and the Siemens managing director had publicly declared that the KESC and M/s Siemens Engineering Co had agreed that Siemens would provide a 428-megawatt brand-new power plant that would be installed and made operative by April 2007.
In December 2006, however, the KESC board of directors, in a meeting with the federal minister for water and power disclosed that the plant being procured was an old one, which was probably made redundant some 15 years ago in Italy.
Mr Aziz pointed out that April 2007 was about to end, but neither any power generation plant had been installed by the KESC nor had any positive steps been undertaken to overcome the shortage of 350-400 megawatts.
He said that as early as August 2006, the KCCI had declared that the KESC had no contingency plan in the event that WAPDA stopped providing 300 megawatt supply, and that Siemens was installing an old power plant under the garb of a new one. This fact was now proved, he claimed.
The KCCI has demanded that the CEO of Siemens in Germany come to the KCCI within 15 days to explain to its members the reasons for not providing a brand-new power plant by April 2007, as per the agreement with the KESC, and trying to sell off “junked equipment as brand new,” fully knowing that it amounted to violating the trust reposed in Siemens by the KESC and the government of Pakistan.
KESC sources pointed out that despite borrowing Rs6 billion from a consortium of banks for running the utility, the private management has failed to improve its generation capability and the 11-kV distribution system.
They claimed that a $125 million loan secured by the utility, through a Habib Bank-led consortium of banks from the IFC and ADB for improving power generation, would take at least two years to see additional power on the grid. To get this loan the KESC had mortgaged its Bin Qasim and Korangi thermal power plants, they said.
