CJP takes suo motu notice of proposed raise in power tariff

Wednesday June 24, 2009

ISLAMABAD: Chief Justice Iftikhar Muhammad Chaudhry on Tuesday took suo motu notice of the proposed plan to increase power tariff by at least a whopping 17 percent across the board, with the exception of lifeline consumers from effective July 1 in spite of massive loadshedding in the country.

Some analysts are of the view that the rise would be as high as from 18 to 20 percent. The court issued notices to Chairman of Water and Power Development Authority (Wapda), National Electric Power Regulatory Authority (Nepra) and power distribution companies (Discos), supporting a raise in electricity rates.

The Chief Justice took notice of the issue on various appeals and newspaper columns as well as programmes on the electronic media. The government has committed to the international financial institutions (IFIs), including World Bank, Asian Development Bank and International Monetary Fund (IMF), to eliminate subsidy in power sector from the 2009-10 financial year.

The government will increase the electricity tariff by 17-20 percent in two phases effective from July 1. According to estimates, calculated by the economic managers and IFIs representatives jointly, if the government does not increase electricity by at least 17 percent during the entire 2009-10 fiscal year, it will cost Rs 75 billion to the exchequer.

Taking notice of the issue, the Chief Justice also asked the Wapda Chairman for comments over the issue. In compliance with the orders of the court, the Wapda Chairman submitted that under the 1997 Nepra Act, it was responsible to determine the tariff rates, charges and other terms and conditions for the supply of electric power services by the generation, transmission and distribution companies and recommended these to the Federal government as well as to comply with guidelines not inconsistent with the provisions of the Nepra Act, laid down by the Federal government.

The Nepra is also responsible to determine and prescribe the procedures and standards, modifications or revision of rates. The power tariff is determined by the Nepra for each distribution company based on company's revenue requirements to ensure smooth running of the company's normal operations after personal hearing and interactions with all stake holders and it was implemented after notification by the government of Pakistan.

Regarding a news item that appeared for enhancement of tariff of Rs 1.96 per unit, the government of Pakistan as reported in the press had not notified the proposed increase in tariff, it added. The Chief Justice directed to put up this case in the court on July 6, within 15 days, and directed to issue notices to Chairman of Wapda, Nepra and all Disocs.


(BRecorder)