Pakistan: An apology without a solution no solution at all

Minister of Water and Power Khawaja Asif, in a press conference, apologised to the nation for failing to ensure supply of electricity during sehri, iftaar and taraveeh, as directed by the Prime Minister, and explained why the government was forced to resort to unannounced power outages.

The reasons behind the energy shortfall have largely remained the same as were evident during the PPP-led coalition government and include: (i) a transmission system that is unable to accommodate more than 15000 MW and any additional supply leads to tripping; (ii) a massive inter-circular debt, which currently stands at 300 billion rupees. This is despite the fact that Federal Finance Minister Ishaq Dar cleared around 400 billion rupees on 29th June, 2013 - a day prior to the end of fiscal year 2012-13 (which increased our indebtedness without reducing loadshedding) as well as the proactive implementation of the Ministry's policy to disable supply to areas where pending bills are in excess of 80 percent of total receivables; (iii) inability to compel provincial governments to pay their dues continues; and (iv) the loss of 1500 MW from the system, the word used by the Minister was "disappeared" because of fault in two transformers in Lahore causing a drop in total generation to 13000 MW.

The supply side issues are compounded by rising annual demand, around 800 MW each year, and a marked escalation during the summer months. At present Minister Asif stated demand has escalated to between 19,000 to 20,000 MW, which several independent analysts maintain is understated with actual demand hovering around 22,000 MW to 23,000 MW. Within the context of supply and demand, he stated that the country should pray for rains that would relieve demand immediately enabling the government to reduce the existing 7000 MW shortfall thereby reducing loadshedding hours which, at present, have risen to 14 hours a day in Lahore - the stronghold of the PML-N.

Critics of the government argue that within one year the government should have shown some results. In its defence the PML-N points out to several ongoing energy projects as proof that the government is engaged in raising generation capacity and cited Nandipur as well as Guddu power plant inaugurations of the Prime Minister amidst much fanfare as proof that generation has increased. A little more than a year later Nandipur remains non-operational as it is furnace-based and the cost to produce simply too high (22 rupees per unit) to justify its operation while Guddu continues to suffer from technical faults. Not one MW of electricity has been added to the system the country has now been informed and all the threats and bravado of the Minister of State Abid Sher Ali has not reduced payables of the sector.

The question is could the government have done different and better? One would have to respond in the affirmative because a look at the PML-N's own manifesto reveals that identified reforms have not yet been implemented. Granted that privatisation of discos and gencos is in the works and the process is scheduled to commence soon but the government has to accept the fact that after the end of its first year supply-demand gap is higher than during the PPP government's last year in power - a year may not be a long time in terms of developing and implementing infrastructure projects but the government needs to explain why it has performed so poorly.