The Auditor General of Pakistan
submitted a report to the president of Pakistan regarding irregularities in the
accounts of Water And Power Development Authority (WAPDA) and PEPCO for the year
2012-2013 and previous audit years. The report highlighted the scale of the
mismanagement that lies behind the country's power crisis. The report was
submitted to the president on 26th of March 2014.
The report says that multiple irregularities, embezzlement, and misappropriation
of Rs 98 bn have been found in the accounts of the power sector. There were poor
monitoring of revenue collection, embezzlement of reserves, misuse of public
funds , non- implementation of commercial procedure and non-adherence to
provisions of power policy and many other failures in power sector in the
financial year 2012-13.
The AGP said, that the reappearance of continual irregularities "cast a shadow
of doubt on the effectiveness of the internal control system." He further said
that the internal controls were bit by bit degenerating as there had been an
increase in cases of unauthorized extension of load, non -implementation of
equipment removal orders , theft of material and electricity and contravention
of procurement rules as well as the Nepra Act .
The audit divulged that FY 2012-13 power distribution companies could not
collect Rs 401 billion from various defaulters- while the procurement of
material and consultancy services, provision of PC 1s contracts included the
defying of procurement rules.
PTI chairman Imran khan said that mega corruption Rs 980 billion is equal to
almost one-fourth of the Rs 4 trillion 2015-16 federal budget .He said time has
come to explore and hold accountable all those who have defrauded nation of the
taxpayers money.
Positive step by PML-N
Pakistan has been facing agonizing want of energy for quite a number of years.
Some attempts have been made to resolve the crisis. The previous government led
by former president Asif Zardari took some initiatives to lessen the supply-
demand gap through implementing consumer friendly energy policies. But because
of the government's corrupt practices in the energy sector , in connivance with
private companies damaged its over all probability. These corrupt practices
......surged the gap in supply and demand of the total output supplied via
Distribution Companies (DISCOs) and National Transmission and Dispatch companies
(NTDC).
Subsequently, when the government of Prime Minister Nawaz Sharif took over in
June 2013, the energy shortage was already at threatening levels with overall
supply deficit reaching 6000 MW to 7000 MW in 2013 resulting improper load
management , unpredictable load shedding , burden on fiscal resources etc,.
Moreover the national transmission system was highly risky and there were
challenges for new investment in the power sector. The present government has
taken major generation optimization plan resulting in improvement of performance
of GENCOs on one hand and improving IPP plants availability during summer on the
other which decreased domestic load shedding from 8-11 hours to 6-8 hours while
industrial load shedding brought down from 8-12 hours to zero since November
2014 except during January and Ramadan. .Similarly effective measures have been
taken to remove transmission and distribution constraints which enable power
sector to utilize 90 percent of its available generation capacity and 16,890 MW
electricity generation against 18,616 NW underrated generation capacity
previously.
These measures have enabled the power sector to pay better and as a result PSO
has received 101 percent of its outstanding during 2014-15 as compared to 77
percent during 2013-14, IPP received 102 percent in 2014-15 as compared to 85
percent during 2013-14 and gas companies 106 percent in 2014-15 as compared to
104 percent in 2013-14.
The lower burden on national exchequer has improved the power sector a lot. In
2012-13 334 billion was the power sector subsidy provided by the government
accounting for 2.4 percent of GDP. Due to better fiscal management in 2013-14
the subsidy was brought down to 292 billion rupees making it 1.7 percent of the
GDP , which further came down to 221 billion in 2014-15 making it 0.75 percent
of GDP. The ministry is making more efforts to bring down the subsidy.
Similarly, the increase in circular debt in 2013-14 was 203 billion making it
0.7 percent of GDP while in 2014-15 it registered only 49 billion rupees
increase accounting for only 0.17 percent of GDP.
New policies have been made due to investment facilitation, adaptable permitting
security documents have been ensured and investors have greater access to the
potential power projects .As a result around 15000 MW of power sector projects
are now on fast track and in different stages of completion.
Furthermore ,Prime Minister Nawaz Sharif and his entire team took far reaching
steps to resolve energy crisis......for that six coal based projects in Punjab
and Sindh were proposed and initiated during late 2013 and early 2014 that were
meant to increase power generation capacity. Nevertheless , the experts
considered them environmentally hazardous because of coal being utilized as the
primary resource.
China is the highest consumer of coal based power plants in the world but the
overall environmental impact has been negative because of higher air pollution
in the industrial areas and the surrounding suburbs .This is reason for Pakistan
to review the coal based energy projects replacing with Liquefied Natural Gas
(LNG) based plants for power generation by February 2015, being considered the
cleanest form of non-renewable energy. A lucrative $ 21bn deal for LNG projects
with the Government of Qatar was also finalized by March 2015.This has been a
positive step taken by PML-N led government because it can reduce the costs by
40 percent and emit 45 percent less carbon dioxide as compared to coal. This is
the cleaner and more effective energy source. Karachi already has an LNG
terminal at Port Qasim and another in Gwadar help reduce energy shortfall.
The focus of MP Nawaz Sharif's government is going in the right direction for
increasing power generation and it is highly appreciable and it is hoped that
the government keeps up with its promises of providing relief to the people.