It seems that Prime Minister Shehbaz Sharif is determined to get the textile sector to boost exports, and also to maximize the effectiveness of the recent incentive given to it in the shape of a cheaper power tariff, by removing its various grievances, so that instead of having to pile on expenses by bribing the WAPDA set-up, they can cut prices and increase their competitiveness. In a meeting he chaired on Friday on loadshedding, power theft, power tariffs and restructuring the transmission system, he zeroed in on two of the most effective tools distribution company officials have to extract bribes from consumers: overbilling for .domestic and commercial consumers, and manipulating the Maximum Demand Indication for industrial consumers. Overbilling not just scares the overbilled consumer, but he or she is then offered a lower reading than his use. Mr Sharif was thus acknowledging an important reality, that theft is initiated by DISCO staff. If overbilling is stopped, which DISCO officials use to shift theft they have connived at to innocent consumers, DISCOs will have to bill consumers correctly, or else let the units go unbilled, and be ascribed to line losses. The same applies to MDIs, except on a much larger scale.
However, the DISCOs have been afforded some relief by the fixed charges which have been approved for all consumers. It almost seems as if the DISCOs are targeting those domestic consumers who are have installed solar power, and are selling their production to WAPDA. They are not paying the DISCOs much, but now they will have to pay the fixed charges, depending on their consumption. Instead of solving the DISCOs’ financial problems, this is merely an incentive to go off-grid. By using the solar power directly, the consumer would vastly reduce the number of units taken from WAPDA, and correspondingly reduce the fixed charge. Such a measure is also shortsighted an assumes that excess power will never be stored as battery technology advances. Even without the fixed charge, if storage becomes affordable, consumers may go off-grid anyhow, and the IPPs may whistle for their capacity charges.
The government and the DISCOs are looking at the issue in the short-term. The future does not include keeping gas-guzzling thermal generation plants online. Technology has been moving at a breakneck pace for the last couple of centuries. Neither the government nor the DISCOs should assume that this is going to change.
