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Murad questions federal body’s authority to take decisions on electricity

Updated January 05, 2019

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Sindh CM Murad Ali Shah says Centre's decisions regarding power projects are illegal and unconstitutional. — File photo
Sindh CM Murad Ali Shah says Centre's decisions regarding power projects are illegal and unconstitutional. — File photo

KARACHI: Sindh Chief Minister Syed Murad Ali Shah has told a representative of the federal government that the decisions — like reducing life of solar and wind projects from 20 to 15 years — taken by the Cabinet Committee on Energy (CCoE) are illegal and unconstitutional.

The chief minister made this observation during his meeting with Special Assistant to the Prime Minister on Energy Shahzad Qasim, who called on him here at CM House.

The meeting was attended by Energy Minister Imtiaz Shaikh, Principal Secretary to the CM Sajid Jamal Abro and Energy Secretary Musadiq Khan.

Mr Shah asked the special assistant that all such decisions be withdrawn because the Council of Common Interest (CCI) was the only constitutional forum to decide policy issues regarding electricity.

“The unilateral and arbitrary decisions of the cabinet committee on energy has created an alarming situation that is adversely affecting provincial interest,” he said and pointed out that the subject of ‘electricity’ appeared at Entry No 4, Part-II of Schedule IV in the Federal Legislative List of the Constitution and the CCI was the only constitutional forum to decide such policy issues.

“Any policy decision by the CCoE on electricity is a clear transgression and infringement into the domain of the CCI,” he said.

The chief minister further said that the CCoE had unilaterally directed reduction in the life of solar and wind projects from 20 to 15 years. It had also imposed a selective embargo on processing of ongoing small hydro, wind and solar projects, he said.

Call to continue all renewable energy projects

The CM urged the special assistant to continue all the renewable energy (RE) projects under the RE policy 2006. Elaborating the policy, he said that it provided a lucrative fiscal and monetary incentives to investors.

“It [the policy] offers attractive returns on equity of 17 per cent [in US dollars] and the power purchaser is responsible for providing interconnection to the transmission lines. The wheeling of electricity is allowed and it allows net metering, billing and facilitates the projects to obtain carbon credits,” he added.

“I would suggest that the CCoE and the Economic Coordination Committee (ECC) should not take any decision regarding electricity in future because the CCI is the right forum,” he suggested.

Mr Shah said that if the RE projects and tariffs as low as under five cents were not allowed to develop, the public exchequer would continue to bleed by expensive energy and forex outflows on fuel purchase.

Mr Qasim, who is an energy expert, said that if 1,000 MW RE power projects were installed the government would be able to save Rs14 billion in the foreign exchange every year. “We have to focus on the production of RE projects,” he added.

The chief minister said that Sindh had a 60km-long and 80km-wide wind corridor coastal belt. He added that the province was known as the country’s energy hub because it had the capacity to produce 55,000 MW wind energy in Thatta, 10GW solar energy, 130 MW Hydero (low head and run of the river), 1,000 MW biogas cogeneration, 500 MW water energy (Karachi produces 11,000 tonnes garbage daily) and 550 MW geothermal.

“The federal government is requested to approve the stuck up RE projects so that work could be started,” he said.

Mr Qasim assured the chief minister of his support and congratulated him on the almost completed Thar coal mining and power project. “It was a difficult task but Murad Ali Shah with his commitment made it possible,” he said.

Published in Dawn, January 5th, 2019

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