ISLAMABAD - The federal government’s proposed ban on the supply of free units to Grade 17-21 employees of WAPDA and Discos is just an eyewash, to pacify the angry electricity consumers, as it will have a negligible impact of approximately Rs 5.35 per month on the consumers, it is learnt reliably here.
The caretaker government is considering the abolition of free units for the grade 17 to 21 employees of various power sector entities, apparently a move to pacify the angry consumers who are protesting against huge electricity bills.
The abolition of free units is a good step in the right direction but its impact on the consumers will be negligible, official source told The Nation on Sunday. According the sources, the total number of current and retired grade 17 to 21 employees, on whom the government has proposed a ban, is 15971 and they are entitled to 7066025 free units per month or 84782300 free units annually. The total annual cost of the free units is Rs 2.340 billion.
The current number of total Discos and KE’s consumers is around 36.40 million. If the government is successful in executing its plan of discontinuing the free units, for the existing and retired grade 17 and above employees, it will have an impact of only Rs 64.29 per consumer/annum on around 36.40 million electricity consumers, the source said and added that the monthly saving will be Rs 5.35 per consumer.
Giving the details, the source said that the total number of Grade 1 to 21 in-service and retired employees, of power sector entities, entitled to free units is 189,171, who consume 417,105,900 units per annum. The total cost of the free units is Rs 11.512 billion per annum. In case the government decides to ban all the free units even then it will have an impact of only Rs 316 per year or Rs 26.35 per month on the electricity consumers. The announcement of banning the free units to some employees of grade 17 and above is mere a political tactic as the major contributor of tariff seems to be outside the control of the government. The major contributors in the current electricity tariff hike are: capacity payments; Discos losses; rupee devaluation; and government taxes. Without tackling these factors the provision of relief to the consumers will be a distant dream and cannot be achieved through discontinuing of free units to the consumers, the source said.
The capacity payments of hundreds of billions of rupees is a major contributor to the tariff hike, burdening the consumers, which is due to the existing agreements with IPPs. During 2023-24, the total power purchase price of XWDISCOs (after excluding the share of KE), works out as Rs.2,866,159 million, which includes Rs.840,462 million for fuel & variable O&M cost and Rs.2,025,697 million as capacity charges including UoSC of NTDC & PMLTC and MoF of CPPA-G. The capacity charges translate into Rs.6,460.81/kW/month based on projected average monthly MDI of 26,128 MW.