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Power shortage

June 28, 2012

RAJA Pervez Ashraf has done it again. He has given himself three months to bring electricity shortages down to ‘manageable’ levels. Even if we were to disregard our past disasters with 90-day deadlines, this is a ‘promise’ resurrected without too much evidence to give hope. Since the prime minister’s maiden cabinet meeting failed to suggest bold and practicable solutions to the government’s power troubles, the people cannot be blamed for being sceptical about the political leader repeating the promises he first made as the country’s water and power minister four years ago. True, the long electricity cuts have eased over the last couple of days. But going back to the gruelling routine may be only a few hot hours away, given the government’s nagging, in fact increasing, problems of cash flow. The cabinet has suggested ‘at-source deduction’ of unpaid bills of the provinces and different government departments, but few believe that this can be done arbitrarily. In any case, this is an old proposal, rarely and selectively applied in the past. The government can hardly try this unless it is ready to open another front with the provincial governments — especially the ruling set-up in Punjab. The Shahbaz Sharif government is holding back payment of around Rs15bn till the time Islamabad ensures ‘equitable’ distribution of shortages. Sindh, with an outstanding amount of Rs52bn against its name, accuses Pepco of ‘over-billing’ it. Similarly, KESC disputes the amount of Rs42bn that Pepco has billed the company.

Besides its liquidity problems, the government’s failure and other stakeholders’ disinclination to accept the call for implementing energy conservation measures decided at the Lahore energy conference in April have also contributed to the duration of power cuts across the country. Similar measures had helped reduce the shortages when implemented, although only partly, last year. The provinces have not been cooperative for fear of risking political support in an election year. As for the long-term solution, it lies in eliminating inter-corporate debt, increasing generation using local, cheaper fuels like gas and coal, abolishing power subsidies and, more importantly, revamping the entire power sector on modern business lines.