LAHORE, June 24: The government has been burdening the Water and Power Development Authority with the ever-increasing cost of inputs but is willing neither to pass on any debt relief nor to finance its social programmes, the Wapda chairman, Lt-Gen Zulfiqar Ali Khan (retired), said here on Monday.

Gen Khan was explaining the reasons for the tariff increases sought by it. The government, he said, had received some relief on its debts, including some debts on Wapda’s account. But the Authority had not passed the relief, he lamented.

The World Bank, he said, extended $800 million for drought relief but the government had not passed any of it to the Wapda, which was a victim of drought.

In addition to the burden, he said, the government had been loading the Wapda with irrational increases in the cost of its inputs. Furnace oil prices had gone up by 141 per cent in the last three years and natural gas prices by 105 per cent but it had received only a seven per cent tariff increase. On account of these increases, he said, the Wapda had to spend Rs81.387 billion. Periodic tariff increases had provided it a breathing space of Rs18.538 billion leaving a shortfall of Rs62.849 billion.

Unless an automatic pass-through mechanism was evolved by the National Electric Power Regulatory Authority, he said, the Authority would lose its financial viability. A correlation, he said, must be developed between the input costs and energy prices.

Capacity payments to independent power producers, he said, were a constant heavy drain on Wapda’s resources. The mechanism agreed for these payments is such that the major burden has to be borne in the first seven years. During the current year, the Authority has to pay an additional Rs30 billion for the amount of power it purchased last year. The Wapda had bought 24.4 billion units and paid Rs85 billion last year. This year it would pay Rs115 billion for 24.2 billion units. Wapda, he said, had not negotiated the agreements. It could not scrap the agreements because the government had furnished sovereign guarantees for them.

The authority, he said, recognized the role of Nepra but resented its propensity to seek publicity at Wapda’s cost. Every time the Wapda requested a tariff revision, he said, the information was leaked to the press even before it was formally accepted. This, he said, had damaged the Authority’s reputation. He said two increases of four paisas each in eight days had put the Wapda in a public relations tight spot. While it resented such attitude, he said, the Wapda could not deny the role of a regulator in a deregulated market.

The Authority’s revenue, the general claimed, had registered a 110 per cent increase. No other organization had made such progress. He also claimed that its power generation had gone up by 13 per cent and line losses declined by 41 per cent. Acknowledgement for phenomenal progress, he said, was in short supply.