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Sunday, July 26, 2009
By Dr Farrukh Saleem
Why is Lahore out of power for 12 hours a day?
Answer 1: Japan Power Generation Limited located at Jia Bagga Railway Station, Raiwind Road, District Lahore, is shut down. Japan Power's 24 residual furnace-oil diesel power-generator sets of 5MW each for a total of 120MW are all shut down.
Answer 2: Southern Electric Power Company Limited, located near Raiwind, is shut down. Southern Electric's six residual fuel oil diesel engine generators of 23MW each for a total installed capacity of 135MW are all shut down.
Solution: Settle political disputes; switch on Japan Power plus Southern Electric and Lahore shall have electricity for at least 20 hours a day.
Benazir Bhutto came out with her Power Policy 1994, under which investors were free to propose the site, technology and fuel. There was exemption from corporate income tax, sales tax, Iqra and custom duties. Benazir's Power Policy was an outstanding success. AES Lalpir, AES Pak Gen, Attock Gen, Fauji Kabirwala, Gul Ahmed Energy, Habibullah Coastal, Japan Power, Kohinoor Energy, Liberty Power, Rousch Power, Saba Power, Southern Electric and Tapal Energy collectively invested some $3 billion and added around 3,000MW worth of generation capacity.
Nawaz Sharif came out with his Power Policy 1998. It was a complete failure. Pervez Musharraf came out with his Power Policy 2002. Under Musharraf's Power Policy, Attock Gen is the only IPP (independent power producer) that has-just recently-been commissioned (capacity: 165MW).
The PPP government has now promised that there shall be "no load-shedding by end-December 2009." But the proposed Atlas Power, Nishat Power, Ruba Energy and Reshma Power are all oil-based. Orient Power, Sapphire Power and Saif Power are gas/dual-fuel. AES and Mitsui are coal-based and their expected COD is June 2013.
Wapda has bought electricity worth Rs65 billion from IPPs, but it has no money to pay them. Wapda has bought oil worth Rs22 billion from oil marketing companies but has no money to pay them. Wapda, PIA and IPPs have bought oil from PSO but now have no money to pay PSO. PSO has bought oil worth Rs62 billion from Parco, National Refinery, Attock Refinery, Pakistan Refinery and Bosicor Refinery, but now has no money to pay the refineries.
Wapda owes Rs21 billion to PSO, Rs37 billion to Hub Power and Rs25 billion to Kapco. PIA owes Rs3 billion to PSO and PSO owes Rs30 billion to Parco, Rs10 billion to Pakistan Refinery, Rs9 billion to Attock Refinery, Rs8 billion to National Refinery and Rs5 billion to Bosicor Refinery.
FATA owes Pepco a colossal Rs80 billion and FATA has no money to pay anyone. Pepco, the Pakistan Electric Power Company, has been supplying electricity to the federal government, the provincial governments, KESC and KW&SB but neither the governments nor their entities have any money to pay Pepco. That in essence is the Rs200 billion circular debt.
However, Budget 2009-10 has allocated Rs1.2 billion for Prime Minister Gilani's foreign tours, Rs390 million for "presidential staff, household and allowances," Rs230 million for the president's foreign tours, Rs645 million for "travelling, conveyance and air tickets" for our MNAs, and Rs7 billion for the "constituency development" of our legislators. The Government of Pakistan has some seven-dozen ministers or VIPs with the rank of minister. The governments of Punjab, Sindh, Balochistan and the NWFP put together have around 12-dozen more ministers and ministerial-rank VIPs. Each one of them cost us Rs100,000 a day.
Japan Power and Southern Electric are political issues. Hardly any other IPP is operating at full capacity. While the Pakistani government is failing to run the already installed capacity, it wants to buy expensive rental power. The federal and provincial governments have truckloads of money to spend on their ministers, but don't ever pay their electricity bills. Load-shedding is political.
The writer is the executive director of the Centre for Research and Security Studies (CRSS). Email: farrukh15@hotmail.com
http://thenews.jang.com.pk/arc_news.asp?id=9
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Sunday, July 26, 2009
By Dr Farrukh Saleem
Why is Lahore out of power for 12 hours a day?
Answer 1: Japan Power Generation Limited located at Jia Bagga Railway Station, Raiwind Road, District Lahore, is shut down. Japan Power's 24 residual furnace-oil diesel power-generator sets of 5MW each for a total of 120MW are all shut down.
Answer 2: Southern Electric Power Company Limited, located near Raiwind, is shut down. Southern Electric's six residual fuel oil diesel engine generators of 23MW each for a total installed capacity of 135MW are all shut down.
Solution: Settle political disputes; switch on Japan Power plus Southern Electric and Lahore shall have electricity for at least 20 hours a day.
Benazir Bhutto came out with her Power Policy 1994, under which investors were free to propose the site, technology and fuel. There was exemption from corporate income tax, sales tax, Iqra and custom duties. Benazir's Power Policy was an outstanding success. AES Lalpir, AES Pak Gen, Attock Gen, Fauji Kabirwala, Gul Ahmed Energy, Habibullah Coastal, Japan Power, Kohinoor Energy, Liberty Power, Rousch Power, Saba Power, Southern Electric and Tapal Energy collectively invested some $3 billion and added around 3,000MW worth of generation capacity.
Nawaz Sharif came out with his Power Policy 1998. It was a complete failure. Pervez Musharraf came out with his Power Policy 2002. Under Musharraf's Power Policy, Attock Gen is the only IPP (independent power producer) that has-just recently-been commissioned (capacity: 165MW).
The PPP government has now promised that there shall be "no load-shedding by end-December 2009." But the proposed Atlas Power, Nishat Power, Ruba Energy and Reshma Power are all oil-based. Orient Power, Sapphire Power and Saif Power are gas/dual-fuel. AES and Mitsui are coal-based and their expected COD is June 2013.
Wapda has bought electricity worth Rs65 billion from IPPs, but it has no money to pay them. Wapda has bought oil worth Rs22 billion from oil marketing companies but has no money to pay them. Wapda, PIA and IPPs have bought oil from PSO but now have no money to pay PSO. PSO has bought oil worth Rs62 billion from Parco, National Refinery, Attock Refinery, Pakistan Refinery and Bosicor Refinery, but now has no money to pay the refineries.
Wapda owes Rs21 billion to PSO, Rs37 billion to Hub Power and Rs25 billion to Kapco. PIA owes Rs3 billion to PSO and PSO owes Rs30 billion to Parco, Rs10 billion to Pakistan Refinery, Rs9 billion to Attock Refinery, Rs8 billion to National Refinery and Rs5 billion to Bosicor Refinery.
FATA owes Pepco a colossal Rs80 billion and FATA has no money to pay anyone. Pepco, the Pakistan Electric Power Company, has been supplying electricity to the federal government, the provincial governments, KESC and KW&SB but neither the governments nor their entities have any money to pay Pepco. That in essence is the Rs200 billion circular debt.
However, Budget 2009-10 has allocated Rs1.2 billion for Prime Minister Gilani's foreign tours, Rs390 million for "presidential staff, household and allowances," Rs230 million for the president's foreign tours, Rs645 million for "travelling, conveyance and air tickets" for our MNAs, and Rs7 billion for the "constituency development" of our legislators. The Government of Pakistan has some seven-dozen ministers or VIPs with the rank of minister. The governments of Punjab, Sindh, Balochistan and the NWFP put together have around 12-dozen more ministers and ministerial-rank VIPs. Each one of them cost us Rs100,000 a day.
Japan Power and Southern Electric are political issues. Hardly any other IPP is operating at full capacity. While the Pakistani government is failing to run the already installed capacity, it wants to buy expensive rental power. The federal and provincial governments have truckloads of money to spend on their ministers, but don't ever pay their electricity bills. Load-shedding is political.
The writer is the executive director of the Centre for Research and Security Studies (CRSS). Email: farrukh15@hotmail.com
http://thenews.jang.com.pk/arc_news.asp?id=9
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it was fun reading this article. 
(I'm a Lahori)
