Prime Minister Shehbaz Sharif has ordered disciplinary action and exemplary punishment for all officers involved in power theft. With a crackdown on power theft started by the caretaker government, and still underway, this was perhaps an inevitability. Circular debt is not the only self-perpetuating problem that the power sector faces: there is also power theft. Distribution companies drive up the tariffs, so that honest consumers end up paying for the power consumed by thieves. Because of the higher tariffs, theft is incentivized, especially for commercial or industrial consumers, for whom the power price is a pass-through item to the end-consumer. That theft is not possible in the long term without the connivance of members of the staff of the distribution companies. A parallel problem is that this staff tempts the consumer off the path of rectitude, and shows the path to power theft. It also shows the consumer who was to stay honest how painful they can make their existence. In short, the very professionals who are best trained to detect power theft are the ones who are acting as its enablers.
The step of punishing those involved in power theft should have been taken long before, much before it became a problem. However, it has had to come only after the power sector became a bleeding wound rather than a profit centre as it is supposed to be. Prime Minister Shehbaz’s declaration that power theft and line losses be eliminated so that privatization becomes possible is not so much timely as overdue. The energy being shown now is probably due to the fact that the government is about to go into talks with the IMF for the new programme it wants so badly, and the IMF has focused much attention on the power sector, because it sees it as potentially bring down the entire financial structure of the government.
The PM showed some inkling of the fact that the power sector is about to be revolutionized and ‘greened’ by renewables, perhaps more than the engineers themselves. As more and more power consumption goes off-grid, and as more and more generation is done by renewables, the problems posed by ending theft may well solve themselves. However, for the time being, the power theft issue remains, and only by punishing the technical staff facilitating it will there be any progress on this painful issue.
