LAHORE, May 6: Persistent drought and raise in furnace oil price have caused the Water and Power Development Authority a loss of Rs23 billion during the first nine months of the current fiscal, authority chairman Tariq Hamid claims.

Talking to journalists on Friday, he said the drought persisted till March and forced Wapda to purchase costly power from independent power producers (IPPs). During this period, he said, Wapda had bought 43 per cent more electricity from IPPs than it did so in the corresponding period last year.

The authority had paid Rs86.23 billion to the IPPs so far this year against Rs66.6 billion in the last year — almost Rs20 billion additional amount.

Besides, it had paid Rs10 billion extra to the IPPs on account of raise in furnace oil price. In all, he said, the authority bore an additional burden of Rs30 billion during the current fiscal.

During this period, however, Wapda’s hydel power generation went down by 17 per cent because of drought-like conditions. “Add to this seven per cent increase in electricity load growth and Wapda’s losses will be any body’s guess,” he said.

This loss calculation, he said, became even simpler when taken in the backdrop of costly purchases from IPPs, which went up by 43 per cent.

The Wapda chairman said up to March, electricity demand grew at a rate of 7.6 per cent but the authority’s income increased by only 6.3 per cent.

He said the nature of consumer categories was such as that did not allow the load growth to be translated into income. Some 44 per cent consumers fall in the domestic category, 29 per cent are industrial, 13 per cent agriculture and six per cent commercial. All of them were charged different rates and the net result was a slide in the total income, he said.

On the sale improvement, the Wapda chairman said, the income increased by Rs7 billion. “If we deduct Rs7 billion from the Rs30 billion loss, the authority still faces a deficit of Rs23 billion,” he said.

The government had to either bear this loss or let Wapda pass it on to consumers, he said, and added: “This is a policy decision that the government has to take.”

The furnace oil price, which was Rs14,200 per ton in July 2004, had gone up to Rs16,600 per ton. Rates of gas also had gone up to Rs220 million cubic feet from Rs203mcf during the last 10 months. Both had cost the authority a staggering amount, he said.

According to Mr Hamid, Wapda’s line losses had reduced by 0.5 per cent in the current year’s first nine months from 24.7 per cent in March last year to 24.2 per cent this year. However, he agreed with reporters that line losses increased during summer and they might climb by 0.5 per cent during the next three months.

He said Wapda’s arrears had increased by Rs10 billion — from Rs74 billion in March 2004 to Rs84 billion this year. Of the Rs10 billion, a sum of Rs8.3 billion belonged to the Federally Administered Tribal Areas, he said.