Pakistan Power Distribution Systems Appraisal

 

Pakistan Power Distribution Systems Appraisal

Distribution system loading assessment

2016 report states that All electricity distribution companies including K-Electric could not make any major improvement in their performance standards, failed to deliver on load shedding schedules, struggled in providing fresh connections to eligible consumers and found misreporting. This is the crux of a performance evaluation report of ex-WAPDA distribution companies (DISCOs) and KE for 2015-16 in comparison four succeeding years starting 2011-12 through 2014-15 compiled by the National Electric Power Regulatory Authority (NEPRA).

`It is noted with concern that 2015-16 also did not witness any major improvement in the performance of Discos and KE under the Performance Standards (Distribution) Rules (PSDR) 2005, said the regulator. Under the said rules, each distribution company is required to submit an Annual Performance Report (APR) in the prescribed format to NEPRA. On top of that, the regulator also `noted with serious concern that DISCOs and KE contributed around Rs49 billion and Rs83bn loss, respectively, to the national exchequer in 2015-16 due to their inefficiency with respect to transmission and dispatch (T&D) losses and recovery targets`.

NEPRAs State of Industry Report 2017 regarding loading position of power transformers of DISCOs system, the report said that on an overall country basis overloading on power transformers has slightly reduced in the FY 2016- 17 from that of the FY 2015-16 but it is still very high, as 36.82percent of the total power transformers in the DISCOs are overloaded, pointing to potential problems. On the country-wise overloading on 11 kV feeders of DISCOs the report said that it has slightly increased, as 29.00 percent of the total feeders are loaded above 80 percent compared to 28.14percent last year. On the overloading of distribution transformers the NEPRA report said that in case of LESCO at 30.13 percent is the highest among Discos, followed by PESCO and SEPCO. LESCO has the worst record of overloading of distribution transformers. Similarly FESCO has very serious issues to tackle with the overloading of its power transformers.

Inflated Bills

Not only are power consumers being charged exorbitant rates to keep a flailing power sector afloat, there have been reports that electricity distribution companies continue to overcharge them to the tune of Rs30 billion per year. The issue of systematic overbilling has been highlighted repeatedly but little has been actually done to combat the problem. Overbilling is a systemic practice should not be hard to handle, if it is accidental and not deliberate. All it should require is for meter readers to take accurate readings – and even if they are unable to check each meter individually, there are reasonably accurate ways of predicting electricity consumption based on past usage. In January alone, consumers paid Rs1.97 billion more than required. On average, the percentage of overcharged units per bill is said to exceed ten percent. What is shocking is how little outrage this practice has generated. Consumers continue to be blamed – and criminalized – for not paying electricity bills. On the other side, electricity companies continue to operate without civil or criminal liability.

If the government is committed to stomping out the practice, the first starting point should be fines for distribution companies for gross malpractice. These fines should exceed the overbilled amounts and be returned to consumers in the form of subsidies. The excuse that the power sector is already in turmoil cannot be used, and consumers cannot be forced to pay tariff above what NEPRA has approved nor can they be forced to pay for electricity units that they have not consumed. There is a need for an independent inquiry into the issue. Some have speculated that Discos may be doing this to show a reduction in distribution losses, which actually stand at around 19 percent. There are reports that the government is planning to criminalize overbilling by Disco officials. This is the right approach but the problem is that distribution companies will continue to rely on overbilling when the government remains focused on revenue collection, instead of systemic reform in the power sector. A NEPRA report in 2015 confirmed that 70 percent of ToU meters are either outdated or out-timed based while around 35 percent of consumers never have their meters read.    

Distribution losses

Losses also have registered an improvement. Losses are presented as follows:

T&D LOSSES
	units for	units	units	units
	Trans	billed	lost	lost
Year	M.kWh	M.kWh	M.kWh	%
2009	82702	62286	20416	24.69
2010	87115	68878	18237	20.93
2011	90575	71672	18903	20.87
2012	88987	71368	17619	19.80
2013	87080	70508	16572	19.03
2014	94089	76543	17546	18.65
2015	95979	78113	17866	18.61
2016	100871	81737	19134	18.97
Growth	2.88	3.96	-0.92	-3.69

Electricity losses in the distribution systems have a major impact on both the supply and demand side and should be reduced as far and as early as possible. On the supply side, a reduction in losses result in gains in the efficiency of the electricity system, helping to reduce the amount of electricity production required to meet demand, with significant financial and associated environmental benefits. On the demand side, non-technical losses are synonymous with unpaid consumption, potentially fostering overconsumption of electricity and putting a heavy burden on electricity supply capacity. From a business approach, a reduction of power losses would lead to increased financial sustainability of the sector, mainly resulting from increased billing and cost reductions associated with a better match between capacity investment and demand. Similar to the practice followed by other countries, NEPRA allows a cap on the percentage of losses that can be factored into the tariff by any DISCO. However, this cap is high for most of the DISCOs and, more importantly, the reduction targets given by NEPRA have not been historically achieved by them. As a result, some of the system losses are passed on to consumers through raised electricity tariffs while a bulk leads to the further ballooning of circular debt.

DISCOs Allowed and Actual Losses %
	FY 2014-5		FY 2015-6
	Allowed	Actual	Requested	Allowed	Actual
PESCO	26.00	34.81	32.00	26.00	33.76
TESCO	22.31	21.41	20.00	20.00	18.96
IESCO	9.44	9.41	9.39	9.39	9.10
GEPCO	9.98	10.72	11.60	9.98	10.58
LESCO	11.75	14.1	13.85	11.75	13.94
FESCO	9.5	11	10.98	9.50	10.24
MEPCO	15	16.8	16	15.00	16.45
HESCO	20.5	27.08	22	20.50	26.46
SEPCO	27.5	38.17	34.15	27.50	37.87
QESCO	17.5	23.85	21.5	17.5	23.92
National Average	15.27	18.7		15.23	17.95

The National Electric Power Regulatory Authority (NEPRA) has noted that Discos have failed to show any improvement in reducing Transmission and Distribution losses as their overall losses have been recorded as 17.95percent for 2016-17. Regarding the T&D losses, the Authority noted that as a whole, DISCOs did not show any improvement in transmission and distribution losses, as their overall losses have been recorded as 17.95percent for both the years. 

Factors responsible for distribution system losses

As the total distribution losses, being the combination of technical and commercial losses, have consistently remained at a high level (17.95% in 2016-17), reducing them by a large margin within a short time poses a huge challenge. The commercial losses are mainly due to theft by two categories of costumers: (1) Domestic consumers that are adversely affected due to negative economic conditions (inflation and/or low incomes); and (2) Industry/Agriculture customers who would like to reduce the cost of inputs, electricity being a major one. A third factor is customer response to low-quality service or poor monitoring by the utilities. As the factors responsible for system losses vary by types of customers, there is a need to devise loss reduction programs which ensure a proper characterization of the target population in order to properly address the problem  

It is time to turn to an oft-repeated complaint about why the power sector in Pakistan performs so dismally.  In 2917, the Punjab Accounts Committee was informed that line losses in the power sector stood at Rs213 billion annually. A day later  the CEOs of four distribution companies  were removed from their positions.   The Peshawar, Sukkur, Lahore and Quetta power heads   all lost their jobs, but the performance of these four Discos differs significantly. PESCO is the worst performing Distribution Company, while LESCO’s performance comes close to the NEPRA limit. The larger problem is that the line losses are reported in a strange way, and are for some reason lumped together with electricity theft. This ends up making it seem like they are the same thing, which they are not. Line losses are energy losses during the transmission process. They are caused by a poor transmission system. Electricity theft is energy consumption that is not paid for or energy that is taken out of the grid through illegal means. It makes little sense to lump the two together. The issue becomes clearer when the figures are provided. In the case of the Peshawar Electricity Supply Company, line losses make up almost 33 percent while power theft is around 12 percent of its losses. The line losses for the Sukkur distribution company stand at a similar figure while power theft stands at around 19 percent. Comparably, the Lahore distribution company does much better with only 14 percent line losses. It is unclear whether the CEOs of the distribution companies can do much when the government’s own priorities seem to be cosmetic when it comes to the transmission grid.

What we need is a detailed investigation into what the sources of the high line losses in Peshawar, Sukkur and other DISCOs are. LESCO has managed to bring its line losses down, although they are still high at over ten percent. Does it have a model that can be reproduced in other DISCOs? However, it would be far too easy to celebrate LESCO as a success story. Its gross contribution to overall losses remains the second highest at Rs34 billion. Much can be improved at its end, even though it has been able to keep its losses close to the NEPRA allowance of 11.76 percent. The losses themselves have little bearing on the DISCOs themselves as the burden is passed onto consumers through higher tariffs, government subsidies to the loss-making DISCOs and constant power outages. And so the overall losses of Rs500 billion are eventually transferred to the public. The Punjab Accounts Committee has asked for a more detailed report on the issue and directed the Discos to replace 66KV lines with 220KV lines which reduce line losses in the system. PEPCO is focusing on installing new types of meters, which base themselves on the false assumption that the biggest problem in the grid is electricity theft. Its own figures show that problems in the transmission grid are a much larger contributor, which raises questions about the usefulness of ADB funding for new meter installation. If this is the approach that will be followed, it doesn’t matter who will be running these distribution companies. They still remain a poisoned chalice. 

  

Technical losses:

Technical losses are basically unavoidable as they are caused by physical inefficiencies such as hysteresis, Eddy Current losses in the iron core of transformers, and the corona effect in transmission lines. These losses are proportional to the square of the voltage and are independent of power flow. Since voltage varies relatively little from its nominal value, these losses are treated as a constant that depends mainly on the quality of the line. Variable technical losses happen when power current flows through the lines, cables, and transformers of the network and these are responsible for bulk of technical losses in the distribution systems.

While the government has continued to focus on recoveries from power consumers – even criminalizing non-payment – it has continued to ignore the gross neglect that continues within the power generation and distribution cycles. NEPRA has revealed that public-sector power generation companies (GENCOs) have lost more than 15 billion units of electricity in the last two years. This would make for an estimated revenue of Rs150 billion. It is criminal that such neglect has gone unnoticed for so long. The losses are beyond the allowed limit of around 670 million units. Most of the losses were reportedly contributed by just one thermal power station in Muzaffargarh, which it itself merits a more detailed audit report to examine whether the power plant is still viable. Other gas-based power stations have been on standby mode for the last two years, which led to a loss of potential to generate viable electricity. NEPRA has concluded that the poor state of affairs at GENCOs is a product of equipment deterioration, lack of maintenance and insufficient technical expertise

Commercial losses:

	Receivables of DISCOs Financial Year ended June, 2016 (Rs. in Billion)
		Receivables			Receivables
		(FY ended	July, 2015 to June, 2016		(FY ended
S.No	Category	June, 2015)	Billing	Collection	Billing Collection June, 2016)
1	Federal Government
a	Federal Government / departments	0.15	12.35	12.43	0.02
b	Local bodies under Federal Government	1.73	3.55	4.23	1.04
c	Autonomous Bodies under Fed. Govt.	1.58	5.90	5.84	1.66
d	Defence	-0.04	15.53	15.58	-0.10
e)	W&P	1.92	1.17	1.26	1.38
	Total Federal Governemt	5.34	38.50	39.34	4.00
2	AJ&K GOVERNMENT
1)	GoP Share	0.4	0	0	0.4
ii)	DISCOs Share	0.00	0.00	0.00	0.00
iii)	AJ&K Share	52.73	16.33	4	65.07
	Total AJ&K	53.13	16.33	4	65.47
3	PROVINCIAL GOVT. DEPTTS./AGENCIES
a)	Punjab	3.46	18.86	20.46	1.84
b)	Khyber Pakhtunkhwa	19.72	5	5.36	19.41
c)	Sindh	66.21	20.6	9.18	73.44
d)	Balochistan	7.7	2.92	5.69	4.94
	Total Provincial Govt. Deptts./Agencies	97.09	47.38	40.69	99.63
	Total 1 to 3	155.56	102.21	84.03	169.10
4	FATA (DOMESTIC CONSUMERS)	37.09	2.47	18.96	20.6
5	AGRICULTURAL TUBE WELLS IN BALOCHISTAN
i)	GoP Share excluding GST subsidy	4.93	7.21	9.62	11.75
ii)	GOB Share	2.77	10.81	13.82	13.61
	Total Agri. Tube wells in Balochistan	7.7	18.02	23.44	25.36
6	6 PRIVATE (Including 4+5)	433.58	853.3	818.52	468.71
7	IPPs	0.02	0.99	0.99	0.03
8	KE	43.7	40.64	38.38	46.24
	GRAND TOTAL	632.86	997.14	941.92	684.08

These are the difference between electricity delivered by a supplier but not paid for by the users, resulting in direct financial losses for the entire supply chain. These losses may be due to actions external to the power system but are also a result of poor overall management of the DISCOs. Theft is the major cause of distribution losses and to prevent it the judiciary’s active involvement (which gives stay orders against disconnection of service to those who are caught stealing) is essential. DISCOs also need their own police stations and/or dedicated police stations to deal with theft with the assistance of provincial government machinery.  The different types of commercial losses with suggested mitigation measures for their reduction are given in Table below.

Table-: Commercial losses and their mitigation

Losses due to	Explanation	Mitigation measure(s)	Primary Responsibility	Secondary Responsibility
Theft	Energy which is illegally appropriated from the network by users through illegal connections	Legal measures through enforcement of electricity theft law	District administration with the help of police	DISCOs
Fraud	Modifying meters to register lower levels of consumption than actually used (tampering)	Sealing, monitoring and replacement with smart meters	DISCOs	DISCOs
Unmetered supply	For example, street lighting and traffic lights	Enact and enforce rules for billing and recovery from city administration	DISCOs	City/District administrations
Mismanagement	Miscalculations or errors in accounting and record keeping	Modernize accounting systems	DISCOs	DISCOs
Non-recovery	Electricity billed but amount not received	Feeder closures to reduce hours of supply (already in force)	Ministry of Energy (Power Division)	DISCOs

Future projections

If not checked the total distribution losses will reach 113,364 GWh by 2040 – a four-fold increase as compared to 26,411 GWh in 2016. This would translate into an annual financial loss of Rs. 1,360 billion by 2040 as compared to Rs. 316 billion in 2018. Unless it is countered effectively, this situation threatens the sustainability of Pakistan’s electricity sector by reducing its financial capacity to undertake investments for improving the overall system infrastructure. Moreover, this lost income indirectly affects progress towards the target of universal access to electricity, as distribution companies will have fewer resources to improve electrification rate in rural areas. The start can be made by directing the investments to Distribution as a top priority action for the power sector. Failing this, new power generation additions will continue but the bottlenecks in the distribution systems will result in more than 15% of the energy generation dissipating as system loss.

A summary of investment needs for the 5- year period from FY2019 to FY2023 is given in Table-below. The list of projects is long and due to inadequate institutional capacity of DISCOs to build a huge infrastructure in a short time-frame, a system should be devised to assign priority for those projects which have the shortest payback period. This can be achieved through adoption of a “Results-Based Investment” methodology so that projects with high benefit-to-cost ratio are implemented first. A strict criterion which demonstrates reduction in losses should be adhered to in making investment decisions.

Table-: Five-Year (2018-19 to 2022-23) Distribution Investment Plan[1]

Serial Number	Name of Program	Investment Needed (Billion Pak Rupees)
Component-1	Distribution of Power	88,378
Component-2	Energy Loss Reduction	62,192
Component-3	Secondary T&G	173,825
TOTAL AMOUNT		324,395

 INADEQUATE CORPORATE GOVERNANCE

Governance at the company level leaves much to be desired. For the most part  the DISCOs’ BODs do not have sufficient authority or capacity to demand accountability of management and staff and are ineffective in managing DISCO performance. Politically driven appointments of CEOs and top management continue to prolong and enhance self interest groups in maintaining the status quo.

Customer Service rules are not enforced and do not adequately reward good customer

Performance or discourage poor performance. At times, companies have deliberately overbilled

Customers, yet were able to escape meaningful punishment. It has been alleged that

Power and fuel thefts are often conducted with employee collusion. The result is a culture

that ignores theft on the part of some workers and poor performance on the part of others and does not reward those who try to perform their functions honestly and with high professional ethics. A Customer Service manual and other performance documents prescribed by NEPRA set out parameters of service. However, none of the DISCOs adhere to such parameters, nor does NEPRA seem to have the will to do so.

GOVERNANCE BY NEPRA

NEPRA was established in 1997, and is legally responsible for the regulation of Pakistan’s power sector. It is legally an independent, quasi-judicial authority   The procedure for tariff determination is lengthy, resulting in tariffs that are non-compensating by the time they are put in force. Similarly,

NEPRA’s administration of fuel price adjustment charges is ex post facto with a significant time delay, thereby failing to cover the rising fuel costs for the power producers resulting in a distorted price signal to customers.

NEPRA members are nominated by the provinces and appointed by the federal government.

While professional standing of appointees is one of the qualifications for appointment, nominations are driven by various personal and political considerations. Consequently, NEPRA is subject to pressure from political and executive quarters in the performance of its functions and generally lacks the professional competency needed to effectively perform its regulatory functions. Moreover, NEPRA’s inability to move beyond the single buyer model in which CPPA is the sole purchaser of power from the power producers and sole seller to the DISCOs needs to be strengthened. This lack of ability inhibits movement towards a competitive power market where power producers and customers are empowered to make direct arrangements to buy and sell electricity on a competitive basis. The regulator is short of qualified technical staff and has to increasingly depend on contract and seconded government staff, which often creates a conflict of interest. A review of the numbers and composition of its staff and subsequent realignment to ensure that staffing matches the needed capability should be done. In addition, the perks and benefits structure for the staff at NEPRA also needs to be reviewed. NEPRA could not retain the professionals it has had as they eventually moved on, having been offered better packages elsewhere in the country.

NEPRA also lacks effectiveness in enforcing accountability of the DISCOs, particularly with respect to reducing T&D loss levels, and meeting performance standards and license conditions as set out through the investments allowed through the tariff petitions filed and performance targets set. In addition, the public does not clearly understand the regulator’s role and rationale, resulting in consumers’ confusion and unrealistic expectations.

POOR REVENUE COLLECTION

Poor revenue collection contributed Rs86.9 billon to the circular debt in 2012. Five of the DISCOs had good collection rates while the other four (Hyderabad Electric Supply Company – HESCO, Sukkur Electric Power Company – SEPCO, Peshawar Electric Supply Company– PESCO, and Quetta Electric Supply Company – QESCO) contributed Rs72.14 billion or 83% of the total uncollected amount. Poor revenue collection is due to a number of factors, .Non-payment of electricity dues by private consumers is one of the largest contributors to circular debt. The problem is not uniform across the country as some DISCOs have good track records while others display poor collection efficiency. Of the Rs197 billion14 receivables from private consumers at the end of FY 2012, 73% is attributable to PESCO (including Tribal Areas Electric Supply Company (TESCO)), HESCO (including SEPCO),and QESCO. The position of each company is shown in following Table

Private Receivables – Million Rs.
DISCOs	2008-09	2009-10	2010-11	2011-12	% Share
PESCO*	26,809	32,902	41,282	51,360	26%
HESCO	18,856	25,454	33,344	44,237	22%
QESCO	4,297	5,238	24,780	48,193	24%
LESCO	10,957	15,968	17,081	23,080	12%
GEPCO	3,585	5,322	5,631	5,912	3%
FESCO	3,719	5,676	5,866	7,068	4%
IESCO	2,287	2,286	2,762	2,703	1%
MEPCO	7,252	10,505	11,900	14,638	7%
All DISCOs	77,762	103,351	142,646	197,191	100%
PESCO includes TESCO and HESCO includes SESCO

In terms of annual performance in the collection of revenue, the overall efficiency was 87%16 in FY 2012. The financial impact of not recovering the remaining 13% is estimated to be around Rs86 billion, or equal to 41 days of furnace oil costs for thermal power plants.17 Again, PESCO, HESCO, SEPCO, and QESCO had the worst collection efficiency, as shown in Table 

DISCO Wise Revenue Collection Efficiency
DISCOs	2008	2009	2010	2011	2012
PESCO*	71%	67%	227%	78%	68%
HESCO	77%	68%	60%	59%	60%
QESCO	86%	80%	76%	41%	36%
LESCO	98%	96%	93%	98%	96%
GEPCO	98%	95%	96%	99%	98%
FESCO	99%	97%	97%	100%	98%
IESCO	98%	97%	96%	93%	96%
MEPCO	97%	96%	94%	98%	97%
All DISCOs	89%	92%	106%	89%	87%

Smart Metering, Jan.,23,2019: Federal Minister for Power has directed electricity distribution companies to immediately undertake GIS (geographic information system) mapping of all 11-kilovolt feeders and replace 100,000 electromagnetic meters with digital meters by the end of February 2019 in order to reduce line losses. The minister told the meeting that the Power Division was in the process of initiating the smart metering infrastructure project in all areas covered by the distribution companies. He particularly mentioned Peshawar and Multan electricity companies, which were the next in line, as Lahore and Islamabad companies had already initiated the process.

Mobile Phone based energy theft detection, Jan., 23, 2019: A mobile company has launched a pilot project to track and curb electricity theft in one of the most difficult areas of the country. The project will be implemented on the electricity feeder of Karkhano area in Peshawar that has a theft ratio of more than 54 per cent. UK’s GSMA is sponsoring the project by funding 200,000 pounds sterling, while digital solutions will be presented to the cellular company, JAZZ. This pilot project would be implemented in the area that has 25,000 consumers, but the cost of monitoring electricity theft under this solution is far less than the smart metering solution presented .The new solution presented by the CISNR works on the basis of installation of ‘smart electronic’ devices at various stages of electricity supply chain and the monitoring offices would detect the quantity of electricity consumption from meters and electricity supplied to that area. With the detection of imbalance in supply and consumption, the relevant electricity company would further narrow down to catch power thieves.

Distribution losses 2018: Jan., 28, 2019: The overall line losses of distribution companies (Discos) in the public sector remained unchanged at 18.3 per cent during the current financial year.The Sukkur Electric Power Company is the most inefficient distribution firm with 41.3 pc line losses this year against 36.7 pc of the last financial year. The line losses of the Peshawar Electric Supply Company dropped by almost 2 pc in a year, but it continues to be the second most inefficient company with line losses of 36.2 pc in 2018-19. Its line losses stood at 38.1pc during the last financial year.The Hyderabad Electric Supply Company came number three as its line losses jumped to 33.6pc in 2018-19 from 29.9 pc last fiscal year.The Quetta Electric Supply Company`s line losses dropped to 21.8 pc this year from 22.4 pc in 2017-18.The Multan Electric Power Company`s line losses jumped to 17.5 pc this year from 16.6 pc the previous financial year.The line losses of the Lahore Electric Supply Company soared to 14.5 pc in 201819 as compared to 13.8 pc in 2017-18.The Tribal Electric Supply Company`s line losses went up to 13.3 pc this year from the previous year`s 12.5 pc.The line losses of the Gujranwala Electric Power Company jumped to 11.1 pc in 2018-19 from 10 pc last year.The Faisalabad Electric Supply Company`s line losses dropped to 9.8 pc this year from 10.5 pc last year.The Islamabad Electricity Supply Company continues to be the most efficient firm as it reduced its line losses to 7.9 pc this year from 9.1 pc in 2017-18.

NEPRA report 2018: July, 7, 2019:

National exchequer suffered a loss of more than Rs. 45 billion in 2017-18 due to the inefficiency of power distribution companies (Discos). It is noted with concern that during the period under report, DISCOs contributed the loss of more than Rs. 45 billion on account of T&D losses, whereas, they failed to make recovery of Rs. 78 billion against bills charged, noted NEPRA in the Performance Evaluation Report of Distribution Companies (2017-18). Under Performance Standards Distribution Rules (PSDR) 2005, each distribution company is required to submit to NEPRA an Annual Performance Report (APR) in a prescribed format. The APRs for the FY 2017-18, submitted by the distribution licensees, were reviewed on the basis of parameters namely, transmission and distribution (T&D) losses, recovery, system average interruption frequency index (SAIFI), system average interruption duration index (SAIDI), time frame for new connections, loadshedding, nominal voltage, consumer complaints, safety, and fault rate. No remarkable improvement in the performance of distribution companies particularly PESCO, SEPCO, HESCO and QESCO has been observed.   

Regarding T&D losses it was observed by the report that most of the DISCOs have made gradual improvement except PESCO, FESCO and HESCO. Particularly, if the values of losses in 2017-18 are compared with the values of 2016-17, it has been observed that all have shown improvement except IESCO and PESCO. While most of the DISCOs have made improvement, KE continued to take the lead among all reducing it from 25.30% in 2013-14 to 20.4% in 2017-18.

Regarding T&D losses & recovery, the report noted with concern that during the period under report, DISCOs contributed the loss of more than Rs. 45 billion on account of T&D losses, whereas, they failed to make recovery of Rs. 78 billion against bills charged. Examination of T&D losses has revealed that none of the DISCOS except IESCO could meet regulator’s expectations. It is relevant to state here that the T&D losses of PESCO were 38.1% against 27.62% as allowed by NEPRA. In the field of recovery of bills, MEPCO & IESCO have shown better performance, whereas, QESCO with a recovery of 46.1% stood lowest among all the DISCOs during FY 2017-18.

MEPCO has shown highest recovery followed by IESCO among all other DISCOs and almost has touched the target of 100%. Further, GEPCO, FESCO and LESCO have also shown good performance in this regard and achieved more than 97% recoveries. Rest of the DISCOs, however are lagging behind the target of 100% which will definitely impact their services to the consumers. Particularly, HESCO & SEPCO have performed poorly. QESCO’s performance is exceptionally bad in terms of recovery rates in 2017-18 which stands at 46.1%. KE achieved 91.04 percent target. On the financial impact of breach of recovery targets, the report said that the loss of revenue which was not recovered by the DISCOs and KE due to their poor management. The loss to the national exchequer accumulates to more than 78 billion rupees. It is also observed that MEPCO & IESCO have incurred very small loss as compared to other DISCOs under this head during the year 2017-18. Whereas, K-Electric has incurred highest loss.

Recovery rates of QESCO, IESCO, GEPCO, FESCO, LESCO, MEPCO have gone down whereas PESCO, SEPCO, HESCO and K-Electric have shown marked improvement during the last 3 years. The report suggests that by applying good governance and management techniques, DISCOs can further improve their recovery rates. Regarding System Average Interruption Frequency Index (SAIFI) and System Average Interruption Duration Index (SAIDI), the report said that SEPCO’s performance in this indicator remained worst of all with a reported number of 568, followed by MEPCO and HESCO with 316 and 180 respectively. On the other hand, PESCO, LESCO, K-Electric and QESCO showed marked improvement. The regulator noted with concern huge variations in SAIDI numbers and maintained that reliable power can be supplied to the end users by improving SAIFI & SAIDI by carrying out regular maintenance of distribution system.

On new connection, the NEPRA report said that in comparison to 2016-17, PESCO, FESCO, LESCO QESCO and K-Electric have shown improvement in provision of new power connections during 2017-18. Whereas, IESCO has shown zero pendency of new connections same as in last year, which is far away from ground realities. NEPRA team during visit of different distribution companies noted with serious concern the number of pending applications. IESCO, PESCO, QESCO, SEPCO, HESCO and K-Electric have provided more than 95% connections to eligible consumers in 2017-18. However, GEPCO’s performance is worst in this regard followed by FESCO. Further, slight breach of targets has also been made by LESCO & MEPCO.

On the issue of consumer service complaints, the report said that the number of complaints received by DISCOs over the period of last five years through different modes indicates a mixed trend with LESCO, QESCO, SEPCO, KE and HESCO receiving a greater number of complaints in 2017-18 as compared to 2016-17. The data provided by the distribution companies shows that except GEPCO, LESCO and K-Electric, all other DISCOs have not received even 2 complaints on average per complaint center per day. This is not rationalized as the same was verified by NEPRA team during visits of different DISCOs.

On the safety issue, NEPRA report said that it was observed that a total of one hundred and fifty two (152) fatalities occurred in all distribution companies in 2017-18. The breakup of data reveals that 72 of these were employees and 80 were general public.

GEPCO reported the highest fatal accidents of 29 in 2017-18 followed by LESCO, IESCO, MEPCO, SEPCO and HESCO with 21, 20, 17, 17 and 15. NEPRA noted with serious concern that these DISCOs have failed to adhere the safety procedures and develop a safety culture. DISCOs are required to prioritize safety as of losses and recovery.

Theft: July,24,2019:  public sector distribution companies (Discos) were now following the KE model in the rest of the country and slowly the system was changing to ABC transformers. AMI system was not a practical solution in areas where theft was taking place through kundas, rather it was effective in areas with theft through meters. AMI was a successful model against electricity theft in Punjab while ABC cabling was a better idea for Discos of Hyderabad, Sukkur and Quetta . Most of the electricity theft in the country was taking place not through meters but through direct cables bypassing meters and it could be addressed with the help of ABC system.  

T&D Losses: Sep., 22, 2019: Transmission, distribution losses of Discos go up by 0.37pc. Recovery ratio has also been deteriorated in eight out of ten Discos and overall recovery ratio has seen a dip of more than four percentage points. NEPRA has said that transmission and distribution losses of the Discos have increased by 0.37 percent during last year and seven DISCOs (excluding LESCO, SEPCO and TESCO) booked a total loss of Rs. 207.3 billion during 2017-18. According to the report, the overall receivables of all the DISCOs have increased by Rs. 166.26 billion which are considerably higher than the receivables of Rs. 45.82 billion during FY 2016-17. As on June 30, 2018, the overall distribution sector receivables stood at Rs. 896.15 billion whereas, the receivables at the start of this financial year were Rs. 729.89 billion. Since DISCOs are centrally controlled by the Ministry of Energy (Power Division), therefore overall responsibility lies with the federal government for taking necessary steps for improvement in this area. . https://nation.com.pk/21-Sep-2019/transmission-distribution-losses-of-discos-up-by-0-37pc