ISLAMABAD: With no immediate solution in sight to the suffering of Karachiites, the electricity crisis in Karachi appears to be turning into a major pre-election issue between the federal and Sindh governments.
The federal government on Friday took a public stance on the gas supply dispute between K-Electric (KE) and Sui Southern Gas Company (SSGC) and said the authorities could not succumb to the “blackmailing” of the former utility. This happened at a time when Karachi’s consumers continued to endure hours-long outages due to power shortage.
Power Minister Awais Ahmad Khan Leghari categorically said that matters could not move forward on the issue of enhanced gas supply to KE without payment, or an agreement on mechanism for payment, of Rs80 billion receivables.
He criticised Sindh Chief Minister Syed Murad Ali Shah for “politicising the crisis” by calling upon political parties in his province to jointly hold a sit-in outside the prime minister’s office in Islamabad.
The minister asked Mr Shah to stop influential people in Sindh from stealing electricity in order to ease the suffering of Karachiites.
For his part, Sindh’s chief minister went a step further and threatened to “raise the issue forcefully in the Council of Common Interests and National Economic Council next week” and not to participate in discussions on other issues.
Mr Shah said the federal government owned 70pc shares in the SSGC and 25pc in KE. The Karachi-based power utility was privatised without the consent of the provincial government, while the federal government guaranteed outstanding liabilities of the Karachi Water Board.
He was of the opinion that the federal government was responsible for resolving the dispute between the SSGC and KE which was threatening to shatter peace in the country’s largest city.
“It seems the PML-N government has decided to target the people of Sindh for categorically rejecting it in the polls,” Mr Shah said, adding that consumers of Hyderabad and Sukkur were enduring outages of between 16 and 20 hours.
Speaking to journalists after presiding over a meeting with senior officials of KE, SSGC and petroleum division, Mr Leghari said the dispute between the two utilities had been discussed in detail at the meeting.
He said a consumer lost his electricity connection on non-payment of only two monthly bills. How was it possible then for a big consumer like KE to continue receiving natural gas after failing to pay such a huge amount for such a long time. The law should be applied to all concerned fairly and equitably.
The KE had its own perspective and wanted to recover receivables from the Sindh government and Karachi Water Board, said the power minister. But the payment of those dues was a provincial matter and should be dealt with at that level.
He said the meeting asked the representatives of the Sindh government, petroleum division, SSGC and KE to sit down and settle their issues while the ministry of finance was asked to assist the parties in reaching an agreement as early as possible.
In response to a question, Mr Leghari said the principal amount payable by KE to SSGC stood at Rs13.7bn while the remaining Rs60-70bn was late payment surcharge based on standard policy. It should be realised that the dispute involved public money and must be settled accordingly. Gas would have to be supplied under a valid gas supply agreement.
“There has been no consumer so far who has received gas without a gas sales agreement. When such a requirement is there for even poor consumers, KE could not be given a different treatment,” the minister said.
When asked why 650MW of electricity was being supplied to KE from the national grid without an agreement, Mr Leghari said the facility was being extended to the people of Karachi so that they do not suffer too much.
He said some people might have had high expectations from the emergency meeting and that the government did want to end the misery of Karachiites, but KE gave a new twist to the dispute. The power utility had perhaps something else in mind and did not proceed as expected.
He made it clear that the federal government would not succumb to any blackmailing because of public sensitivities. The National Electric Power Regulatory Authority was an independent regulator and its chairman did not attend the meeting because doing so was outside the regulator’s domain.
A senior official said the government team complained to the KE team, led by its chief executive Tayyab Tarin, for frequently taking matters to court instead of resolving them and on making profits without improving the transmission and distributing network.
The issue of non-payment of Rs30bn to the National Transmission and Dispatch Company against supply of 650MW was also brought to the table.
Mr Tarin told reporters before the meeting that KE had processed Rs6bn payment against security deposit and was ready to streamline payment of the principal amount of Rs13.7bn, but SSGC was not ready to sign a gas supply agreement. Sadia Dada, the KE’s spokesperson, said the SSGC was insisting on payment of Rs60bn interest and late payment surcharge.
Published in Dawn, April 21st, 2018