ISLAMABAD: The government has estimated that the gap between total billing to all power distribution companies (Discos) and their receivables are projected to witness a whopping rise in figures that might touch to Rs601 billion and Rs669 billion during the ongoing fiscal and next financial year respectively.The Ministry of Power has come up with projection of increasing gap with passage of every week/month on the basis of some major assumptions such as the gap is bound to increase after notification of new electricity tariff from 1-1-2019, subsidy continued to be paid by the government and no administrative/ governance reforms or technological improvements are made. It indicates that without undertaking major reforms, the cash bleeding power sector is heading towards a disaster like situation despite hiking electricity tariff. Now the ministry has proposed further hike in tariff by 25 percent within next four months (March-June) period of the current fiscal year.With prevalence of status quo scenario, the Ministry of Power has shared its assessment with top officials of PTI government and revealed that total billing by Central Power Purchasing Agency (CPPA) to DISCOs were projected at Rs1519 billion till June 30, 2019 against Rs1271 billion in the last financial year 2017-18. Total billing by CPPA to DISCOs was projected at Rs756 billion for first half (July-Dec) period and Rs763 billion for second half (Jan-June) period of the current fiscal year. The billing by CPPA to K-Electric is projected at Rs61 billion for the current fiscal against Rs53 billion in the last financial year 2017-18. So total billing by CPPA to all DISCOs and K-Electric would be standing at Rs1580 billion till end June 2019 against Rs1324 billion in the last financial year 2017-18.The receivable by CPPA from all possible avenues were projected at Rs978 billion including Rs961 billion by DISCOs, with 1 percent loss reduction it would impact Rs9 billion, with 5 percent recovery there would be impact of Rs26 billion.Keeping in view billing of Rs1580 and total receivables of Rs978 billion, the gap has been projected at Rs601 billion for the ongoing fiscal year 2018-19 ending on June 30, 2019.For the next financial year 2019-20, the Ministry of Power has estimated that the billing by the CPPA to DISCOs would go up to Rs1490 billion while billing to KE would be reduced to Rs57 billion. It estimates that total billing by the CPPA to all DISCOs/KE was projected to touch Rs1546 billion in 2019-20.The total receivables from all heads including normal recovery against bills of DISCOs, 1 percent reduction of losses impact and 5 percent recovery increase impact were projected to touch Rs878 billion so the gap was going to touch Rs669 billion in the next financial year 2019-20.The Ministry also assessed that in case of continuation of subsidy the financing gap for cash bleeding power sector was projected at Rs367 billion for the current fiscal year 2018-19 which could further increase to Rs383 billion for the next financial year 2019-20.The tariff differential subsidy (TDS) has been projected at Rs100 billion for the current fiscal year against Rs49 billion in last financial year 2017-18. It is estimated that the TDS will be standing at Rs89 billion for the upcoming fiscal 2019-20. The Fata subsidy is projected at Rs16 billion for the current fiscal and it might be standing at Rs14 billion for the next financial year.The Balochistan’s agriculture subsidy on tube wells is projected at Rs5 billion for the current fiscal year that might increase to Rs9 billion for the next financial year. The subsidy amount to KE is projected at Rs40 billion for the current fiscal and it might be increased to Rs57 billion for next fiscal year 2019-20.The subsidy to AJK is projected at Rs8 billion in the current fiscal year and it is estimated that it can go up to Rs16 billion in 2019-20. The DISCOs recovery from defaulters is estimated at zero in both the fiscal year. The industrial support package is projected to cost Rs38 billion in 2018-19 and Rs79 billion in 2019-20.With quarterly adjustments of tariff, the net financing gap was estimated at Rs277 billion in the ongoing fiscal year and Rs234 billion for the next financial year 2019-20.
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