ISLAMABAD: The federal government has claimed Rs225 billion in receivables from K-Electric (KE), with Rs186.5 billion attributed to mark-up on a principal liability of Rs38.8 billion, according to the power division’s latest circular debt report.
The report, released after a six-month gap, highlighted a reduction in the power sector’s circular debt, which stood at Rs2.381 trillion as of November 2024—a notable decline from Rs2.678 trillion in November 2023, marking an 11% decrease.
The report revealed that circular debt across three major categories—payables to power producers, fuel suppliers, and liabilities parked in Power Holding (Pvt) Ltd—declined during July-November 2024. KE’s non-payments fell to Rs11 billion in November 2024 from Rs59 billion a year earlier.
Factors contributing to the debt reduction included over-collection of Rs31 billion in pending generation costs through quarterly tariff adjustments and fuel price adjustments, along with Rs234 billion in recoveries from prior-year adjustments, up from Rs133 billion last year.
However, the report noted challenges in loss-related inefficiencies, which rose by 34% to Rs94 billion. Discos’ under-recoveries halved to Rs76 billion, but the total cost of losses and under-recoveries remained substantial at Rs276 billion and Rs315 billion, respectively.
K-Electric and the government continue to negotiate settlements as KE claims higher receivables from provincial departments and other entities.
Story by Khaleeq Kiani
