By Rehan Jawed
Karachi is Pakistan’s economic hub, contributing 50% of the nation’s total tax revenue and producing 50% of the country’s exports. Yet, its consumers and industries bear the highest electricity costs in the country, making it increasingly difficult for them to sustain operations.
Costs of Write-Off claims must not be imposed on Karachi’s consumers. If K-Electric’s financial sustainability is a priority, the federal or provincial government and NEPRA must resolve this issue without burdening Karachi’s already over paying consumers.
We fail to understand why this write-off claim was included in K Electric agreements. Why cannot K Electric recover this amount from defaulting consumers on its own? The SSGC is operating in the same city with a significant reduction in UFG.
Any commitments made to K-Electric must be fulfilled by those who committed after proper verification, but not at the cost of Karachi’s electricity consumers.
Imposing Write-Off claim costs on Karachi’s industries will worsen the current economic crisis. Many industries are shutting down, unemployment is rising, and factories are being turned into warehouses. More than 100,000 labourers have already been let off due to factory closures in the Korangi Industrial Area in the last three years only, and we fear that the way industries are shutting down due to higher electricity costs could lead up to rendering a million factory labourers jobless.
Karachi consumers already pay the highest rates in the country, as seen in the November 2024 bills, where they paid PKR 7 per unit more compared to regions like LESCO and HESCO. This is despite claims of a uniform tariff across Pakistan, which clearly does not exist in reality.
Another severe injustice is that Karachi’s consumers have played no role in the creation of circular debt, which has been caused by DISCO inefficiencies. Yet, they are unfairly charged a PHL surcharge of PKR 3.23 per unit to cover circular debt interest without having any Participation in it.
Covid Incremental Dues of Rs 33 billion have still not been paid to Industrial Consumers of Karachi.
While 100% bill recovery in Karachi may not be possible due to law enforcement challenges, the Federal and Sind governments have failed to address electricity theft and treat it as a crime. Honest consumers and industries should not be punished with additional surcharges for failing to impose the law.
Is this write-off claim clause not understandable? Does it mean those who do not pay electricity bills can easily get away without paying them?
The main question is why the government does not treat electricity theft as a crime.
A truly uniform tariff is essential. Karachi consumers are disproportionately charged higher surcharges, such as PKR 1.52 and FCAs exceeding PKR 3 per unit. FCA and surcharges must be equally applied nationwide to ensure fairness. One nation, one bill for each category needs to be enforced. It is unjustified to charge Karachi consumers a higher rate of electricity in the form of surcharges and higher fuel adjustments.
We reject any attempt to impose Write-Off costs as any Additional Surcharges on Karachi’s electricity bills. It is the government’s responsibility to address K-Electric’s financial issues without adding to the burden on Karachi’s consumers and to treat electricity theft as a CRIME.
I would Like to bring to your knowledge that Karachi is already under immense financial strain, and if Nepra or the government decides to impose any additional unjust surcharge to recover these write-off claims, then it would tantamount to collective punishment.
Karachi’s prosperity directly impacts Pakistan’s progress, and protecting its industries and consumers is a national duty. This write-off claim, if imposed on Karachi consumers as a surcharge, will be a classic example of robbing Peter to pay Paul. We also fear if any additional surcharge is imposed, it could lead to a law and order situation.
We would also like to inform the authority that if any additional surcharge is imposed on our electricity bills, all associations, chambers, and trade bodies of Karachi are on one page, and we reserve the rights under the Law for Peaceful Protests and Legal Action in courts if required.
