Pakistan loses Rs380 billion every year due to power crisis

Friday, June 1st, 2012 5:40:28 by

Pakistan loses Rs380 billion every year due to power crisis

Thursday, May 31, 2012: Pakistan loses around 2%, or Rs380 billion, of GDP (Gross Domestic Product) every year due to the prevailing power crisis in the country.

According to the to the Economic Survey 2011-12, the  cost of subsidies given to the power sector during the last four years 2008-2012 is Rs1,100 billion, almost 2.5% of GDP.

The government is planning to phase out the given subsidy in the power sector and cut down subsidies in a bid to bring it back on its feet, adds the survey.

Subsidy claims amounting to Rs56 billion were disbursed till December 2011 while overall subsidy claims are estimated to between Rs91 billion and Rs125 billion. Subsidies have cost the government Rs1 trillion in past four years.

Meanwhile, power distribution companies (DISCOs) were to receive Rs354 billion till February 2012 against payables of Rs398 billion till April 2012.

“Heavy line losses at 20%, incomplete corporatisation, weak governance and costly fuel mix put an extra financial burden,” adds the survey.

The liquidity crunch in the power sector has made it difficult for power generation companies to purchase oil, which has resulted in under utilisation of installed capacity by 4,000MW. Despite power shortfall of 6,000MW per day,
the number of power consumers increased by 730,000 to 20.85 million during July 2011 to March 2012 compared with 20.12 million in the corresponding period last year.

The contribution of hydel electricity generation increased to 33.6% in 2010-11.

Water and Power Development Authority (WAPDA) remained the main contributor to electricity generation with 48.7% followed by Karachi Electricity Supply Corporation, Pakistan Atomic Energy Commission and then the two independent
power producers Kot Addu Power Company and Hub Power Company. IPP contributed almost 25% of the total power generation.

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Short URL: https://www.newspakistan.pk/?p=24447

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