ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) to take legal action against the Electricity Distribution companies over circular debt of Rs 276 billion in terms of increase in Transmission and Distribution (T&D) losses, sources claimed.
The NEPRA has taken this decision during the examining of the Circular Debt (CD) report for June, 2024. The Central Power Purchasing Agenc- Guarantee (CPPA-G) had submitted the report.
The report says that the DISCOs electricity purchases for the FY 2023-24 have been decreased to 115,142 GWh, ie, 1% less as compared to 116,696 GWh for the FY 2022-23. The losses of the DISCOs were surged to 18.31 percent against the 16.84 percent during FY 2022-23.
The NEPRA allowed 11.77 percent T&D losses to the distribution companies for the Fiscal Year 2023-24. Contrary to the assigned target, the distribution companies violated the target by 6.54 percent during the period. The excessive losses of Rs. 276 billion has added the circular debt for the FY 2023-24.
The huge losses of the DISCOs were witnessed despite the fact that the companies were allowed to investment of Rs.163.1 billion for the FY 2023-24 to improve their transmission network.
The financial impact of unrecovered billed amount has surged to Rs.315 billion in FY 2023-24 as compared to Rs. 236 billion for the FY 2022-23. The Regulator is of the view that the surge in circular debt for the FY 2023-24 was blinked at around Rs. 83 billion, mainly due to the fact that Rs. 374 billion was paid though fiscal space.
The NEPRA Authority has studied the report and expressed serious concerns over the performance of the companies. On the basis of the report, the authority has decided to start legal action against the DISCOS who contributed in circular debt in terms of increase in T&D losses and decrease in recovery in FY 2023-24.
