ACCORDING to reports, the government is all set to hand over power distribution companies to the respective provincial governments as part of the strategy to improve performance of the problem-ridden power sector. The decision to transfer ownership of XWDISCOs to provincial authorities is viewed as a critical step toward curbing losses within the energy sector and addressing rampant power theft. The plan will be implemented in two/three years once it is cleared by the Council of Common Interests (CCI).
There has been a consensus for a long time that the centralized power distribution network is one of the major impediments in the way of improving efficiency and checking power theft which has assumed menacing dimensions. It was because of this that the ex-WAPDA network was divided into nine distribution companies but their control still rests with the federal government which lacks the resources to carry out reforms in the sector and things could not be managed effectively even when WAPDA was virtually handed over to the Pakistan Army. There is also a fashion to talk about privatization of this or that organization instead of making sincere efforts and devising professional strategies to improve their performance and output. Despite repeated attempts by successive governments, the circular debt too is increasing day-by-day and the policy-makers only resort to tariff increases in a bid to overcome the challenge. We have been emphasizing in these columns that the problems of the power sector would remain there until and unless necessary investment is made in the distribution network to reduce line losses and curb the growing tendency of theft and wilful default in payment of bills. This task can only be performed by the provincial governments which have men and material resources to check theft, penalize thieves and defaulters and modernize the manageable distribution networks under their administrative control. Presently, there are some discos incurring losses in the range of 30 to 40% (PESCO and SEPCO) and under the policy of uniform tariff, burden is added to consumers in those regions where the instant of loss is just 8 or 9% (IESCO and GEPCO). The decentralization would enable the provinces to announce their own tariff plans providing relief to consumers of efficient discos. The decision to keep generation and transmission with the federal government is also understandable as this would ensure focus on necessary investment for the purpose. Apart from the plan to hand over existing discos to provinces, the private sector should also be allowed to set up parallel distribution companies giving options to consumers to switch their connections to companies offering more reliable services and economical packages.
