KE making huge profits at consumers’ expense, Nepra hearing told

Updated September 05, 2014

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KE got as much gas as they needed from the Sui Southern Gas Company so they produced almost all the electricity during this time on gas, not furnace oil.— File photo
KE got as much gas as they needed from the Sui Southern Gas Company so they produced almost all the electricity during this time on gas, not furnace oil.— File photo

KARACHI: Even though K-Electric defended fuel adjustment charges, shareholders and consumers at a public hearing called by the National Electric Power Regulatory Authority (Nepra) at a hotel here on Thursday said the benefits of saving money only went to the power utility in the form of government subsidies while they gained nothing as the amount really was not reduced in their utility bills.

Presenting their case of fuel adjustment for the months from April to June, the KE’s finance director, Amir Ghaziani, said they were asking for -39 paisa for April, -56 paisa for May and -68 paisa for June. The quarterly charges, meanwhile, came to -98 paisa.

Abu Bakar Usman of Pasban said that the KE got as much gas as they needed from the Sui Southern Gas Company so they produced almost all the electricity during this time on gas, not furnace oil. “For example, in April, they produced 87 per cent power on gas and 22pc on furnace oil. Therefore, they saved more money than they are showing here. Someone should look into such discrepancies and we should be given the benefits of such differences, too,” he said.

General secretary of the Karachi Electric Supply Company (KESC) Shareholders Association Choudhary Mazhar Ali said the impact of buying less furnace oil or saving on fuel, etc, somehow never reached the consumer.

He also raised his grievance with Nepra for failing to advertise this meeting in the media so that more consumers could have attended it.

Choudhary Mazhar reminded the regulatory body about their promise of opening an office in Karachi to which Khawaja Mohammad Naeem pointed out that they had an office in Karachi now through which they had also received some 600 complaints from consumers since January.

Another consumer, Anil Mumtaz, told the Nepra officials that the KE was being economical with the truth about carrying out heat-rate tests of their two Bin Qasim plants. “They have closed two units there and yet somehow are getting approval on paper for their heat-rate tests,” he said.

About the loadshedding done by the KE during 2013, Mr Mumtaz said it amounted to 48pc. “In the KESC’s annual report for 2013 it was said that 48pc loadshedding was carried out due to loss. But the loss was really 12pc and they made money in doing more than required loadshedding,” he said.

Adil Gilani of Transparency International said that there were audits needed in the KE after KESC, privatised in 2005, saw new parties joining in in 2008. “If you charge your consumers the correct amount for the power you generate at far cheaper rates,” he said to the KE officials at the hearing, “the factories in Karachi will work to capacity, a way out of our circular debt.”

To the Nepra officials, he said: “There were certain conditions that went with the privatisation of the KESC in 2005 one of which was that you will be the governing body over the KE. Please do not let them get away with discrepancies.”

Mohammad Tahir, a consumer from Bufferzone, said even for pruning a few trees, the KE shut off power by shutting off the feeder. “They use small excuses like pruning trees to shut down the entire area and benefit from it,” he said.

Mohammad Saeed Khan, another consumer, wanted to know why the consumer was expected to pay the Rs8 bank charges in the bill.

Barkat Ali, chairman of the Qadri Foundation, wanted to know why the consumer who regularly paid his bills was being punished for other people’s crimes. “We pay our bills even before the last date mentioned on them but our areas have to experience loadshedding for hours to make up for the KE’s PMT losses due to power theft by criminals. The criminals should be caught by the KE. They are not our problem. By not giving us power for 24 hours despite our paying our bills, does the KE want us to side with the criminals who steal power because we may be better off that way as why should we pay when we are not even getting uninterrupted power?” he said.

For Nepra’s reaction to the hearing, Khawaja Mohammad Naeem said that first they would ask for the KE’s replies through rejoinders and then give their own judgement.

Published in Dawn, September 5th, 2014