The conversion of domestic consumers while piggybacking on the distribution companies has an element of social irresponsibility, because it leaves the less affluent consumer (whoever cannot afford to install the solar-power paraphernalia of inverters, panels and so on) left to pay WAPDA Distribution Companies ever higher tariffs because those DISCOs have to pay the capacity charges that had been promised by the government. It is a vicious cycle: as more consumers convert to solar power, the same charges will be levied from fewer consumers, leading to higher tariffs. However, those converting are driven to do so by pure economics. It’s cheaper. Actully, they’re doing the government a favour. Actually, two favours. First, theory generate more than they use, and put the excess back in the grid, thereby reducing the shortage. More importantly, they are doing something outrageous, and never really asked of the consumer: investing in generation. The consumer always paid for generation investments by WAPDA in the tariff, but for the first time, the consumer is investing in generation apparatus, and amortizing it with the savings on his electricity bill.
Capacity charges have been solved, or are in the process of being solved, by twisting the arms of the Independent Power Producers, who are collecting money without generating a single unit of power. However, this has left the entire investor class jittery, and though it was probably not the primary reason, the PIA privatization, which recently came a cropper, is being blamed on this refusal to honour an agreement. However, there does not appear to be a similarly messy solution to the question of distribution. There was a separate National Transmission and Dispatch Company created when WAPDA was unbundled, but it might only come up for privatisation when the DISCOs are sold off. Solar power is generated at homes, and is mostly consumed there, but the generation costs are not charged when the excess is fed into the grid. This was pointed out at the plenary orgnised by the Sustainable Development Institute on the subject of renewable energy.
The real danger for the government is when consumers are able to store the excess generation for themselves. If they go off grid, then they will escape the taxes presently charged by the government in the electricity bills. The government may find this income streaming drying up because of its own rapacity. It must not forget that the electricity consumer doesn’t want to lose the security of a DISCO supply. When he does, that will be a day of reckoning.
