June 2, 2021 (MLN): Karachi’s trade bodies, associations and civil bodies have urged the government to quickly unbundle K-Electric and end the exclusivity and monopoly of the power company for efficient management of Karachi’s power needs.
“[We] have been demanding the government to kindly consider and end the exclusivity and monopoly of K-Electric for the last several years in the interest of Karachi and Karachiites,” wrote Pakistan Hosiery Manufacturers & Exporters Association (PHMA) Chairman Jawed Bilwani in a letter to Prime Minister Imran Khan, Energy Minister Hammad Azhar and Special Assistant to PM on Power & Petroleum Tabish Gauhar.
In the letter, the association pointed that despite a lapse of 15 years since the Karachi Electric Supply Company (KESC) was privatized, the K-Electric is still observing load-shedding even though the country is now producing surplus electricity. Meanwhile, it added that the private utility company lacks generation and distribution capacity.
The association also lamented that the KE continues to report transmission and distribution losses at 19.5 percent although it was bound to reduce the losses to 15pc by 2015 as a condition for privatization in 2005.
The PHMA said that there is an urgent need for “unbundling of the KE into separate generation, transmission and (more than one) distribution companies instead of transferring it as a single entity to some other large foreign firm.”
The letter informed PM Khan that at the time of KESC’s privatization, it had cautioned the government not to allow the exclusivity of the country’s largest city’s power supply to a private entity.
Meanwhile, it also said that SAPM Tabish Gohar has also endorsed the need for unbundling KE calling the sell-off of KESC to a single company a policy mistake.
Earlier, the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) had also made a similar demand from the government seeking an end to KE’s monopoly in power provision of the city.
FPCCI President Mian Nasser Hayat Maggo had asked the government to immediately unbundle the KE and provide a framework under which the KE is “managed by a different set of private entities going forward to avoid monopoly control and single point of management failure or success.”
On the other hand, the Karachi-based trade bodies have also opposed the proposed bid by Shanghai Electric to acquire KE arguing that extending the current monopoly structure will be detrimental to the city’s economy.
Over the years, the KE has been lambasted over its failure to meet power needs of the city in addition to charging exorbitant rates from the city’s consumers – at times higher than the distribution companies of Lahore, Gujranwala, Multan, Faisalabad and Islamabad.
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