Decision on new dams expected soon

By Khalid Butt
Aug 08 - 14, 2005

Chairman Wapda Tariq Hamid looks at the burgeoning energy requirements as a great challenge whose only solution hinges on a timely decision for building major dams.

In a wide-ranging interview with PAGE, the seasoned and dynamic Wapda chief, a qualified engineer and management professional with highly diversified background of Corporate Sector, touched on many aspects of Wapda's role ranging from its recent performance to future needs and vision, holding a key to the salvation of national economy.

The amiable and highly approachable chairman, unlike some of his former Khaki predecessors, represents a refreshing change for the organisation, which is breathing once again as a credible public sector entity and showing tangible results and proper vision for the future.

Tariq Hamid, without mincing any words, put it straight that the country can ill afford to dilly-dally on the issue of dams as valuable time is fast ticking away. According to him an urgent decision and announcement on the construction of big dams like Kalabagh, Bhasha and Dasu is imminent within days or weeks, rather than months. The dams, he said, would take some 5-8 years to complete, adding, the country can hardly delay this vital decision any more, "or else we would be in a big trouble indeed". "Let there be no doubt about the current situation of fast vanishing capacity of our big dams and galloping yearly energy need rising by 7.55 per cent, what other alternatives you are left with," he asks? He, however, sounds quite confident that a crucial decision by the government is just around the corner and expected at any time in the near future.

Spelling out the current installed capacity of 17000 MW, which includes generation from thermal and hydel projects as well as electricity purchased from IPP's, he said even this generation is reduced to around 11500 MW during winter months.

He said if a prompt decision on the dams was not made soon the country would be facing the stark spectre of losing its entire present hydel capacity in next 5-8 years due to the current rate of silting in the dams which is rapidly reducing the production capacity.

The Chairman said that the WAPDA has already completed its homework and submitted the necessary plans to the government, along with a study conducted by officially appointed consultants to endorse its estimates and recommendation.

He further said that based on their experience of last year, their performance during current peak summer period has been most satisfactory.

The phased and seasonal maintenance work of the thermal projects would be duly taken up during September and afterwards and public was spared from the agony of load-shedding this year during peak summer months, he said. Besides this watchfulness by WAPDA management, other projects of national importance have also been undertaken during the year, he added. WAPDA, he said, had already started streamlining the distribution system as well as installing capacitors and other modern equipment. Streamlining of vital transmission lines running from North to South was also in hand to bring stability to the distribution system in the country especially in the high consumption central zone, he said. WAPDA has over 12 million domestic consumers and in the last two years it has electrified 16,000 villages and installed over 20,000 tubewells in the country, he added.

Tariq Hamid specially pointed out with a sense of pride the introduction of reduced electricity tariff for the farmers of the country through ToD metres. This scheme offers electricity during the late night period when pressure is relatively lower. The scheme, he felt, would prove a blessing for the farmers of all the provinces.

He said that Wapda is not in a position to provide cheaper electricity to people due to the increasing cost of electricity generation.

The Chairman said that national reservoirs had lost 27 per cent storage capacity and would lose another 6 per cent in the next four years. This implies that they could store only 9 per cent of its water inflow, against 33 per cent by India, 347 per cent on River Nile and 497 per cent of Colorado River, he added.

Highlighting the performance of Wapda for fiscal 2004-05, Tariq Hamid said that revenue collection has increased to Rs. 246 billion as against Rs. 232 billion last year. He said that increase in domestic consumers was 6.4 percent, agricultural consumers 1%, commercial consumers 2.5 percent and industrial consumers 1% in last fiscal.

He said that splitting these receivables into three main heads, FATA, public sector and private sector, the picture would be very clearly pointing out where do the shortcomings lie and at which level. He said that FATA receivable had jumped from Rs. 32.6 billion to Rs. 40.9 billion, and Rs52.12 billion during the years from 02-03 to 03-04 and 03-04 to 04-05, respectively. The only option left with the Wapda was to cut the electricity to force the defaulters at all levels for making the payment. But ground realities in NWFP did not allow Wapda to implement this option.

Tariq Hameed said that Wapda has paid 113.72 billion rupees to IPPs during last fiscal. He said that efforts are underway to improve the present transmission and distribution system for ensuring smooth supply of electricity.

He said that the authority has spent 8 billion rupees on new transmission lines and grid stations during the last one-year and it would spend 26.388 billion rupees to upgrade its system during the current fiscal.

Tariq claimed that line losses have come down by 0.8 per cent during the last fiscal, adding that the authority has electrified 9,467 villages during the last fiscal.

The Wapda chief said that report of technical committee on hydel projects was likely to be ready in the next two weeks.

He said that Wapda was facing tremendous pressure for providing more agricultural tubewell connections. However, he added that the quality of sub-soil water was deteriorating faster particularly in Southern Punjab. At present, Wapda has received money for 3,000 new tubewells and over 4,000 applications are pending with it. The process, if allowed to continue unchecked, would harm agriculture in the country, he opined.

To a query, he said that no load-shedding is being carried out in any part of the country, as Wapda has sufficient quantity of electricity. He said that in future only ToD meters would be installed for agri tubewells. He said that introduction of ToD meters in agri sector will not only save Rs 75 paisa per unit to growers but it would also help Wapda in load management.

The chairman said that WAPDA was making expenditures under various heads like establishment (mainly pay and allowances), maintenance and repair, oil and gas payment both to IPP and own thermal power houses, IPP, energy and capacity charges, directing debt servicing hydel profit to NWFP and AJK governments and tariff subsidy to AJK government and agriculture sector of Balochistan.

He said that the alarming increase in expenditure has been due to ever-rising payments for furnace oil and gas. The oil and gas payments have been increased from Rs32.7 billion to Rs43.2 billion during the corresponding months.

The energy and capacity charges of Independent Power Producers (IPP) during this period also rose from Rs64.8 billion to Rs86.2 billion. This increase is mainly attributed to the drought and less water level in the reservoirs. Wapda could reduce this expenditure by adopting load management (load shedding) plan but again at the cost of industrial and agricultural output and discomfort to its domestic customers, he added.

He said that the expenditure on the payment of net hydel profit and water use charges to the governments of NWFP and AJK was almost fixed and the payment of approximately Rs7 billion is obligatory on Wapda.

He pointed out that the losses could have been decreased even further if Wapda did not have to transmit the thermal generation from South to the load centres because of lesser hydel generation owing to low availability of water. He added that auxiliary consumption remained higher as thermal houses had to run at full capacity to meet the electricity demands.

It seemed ironical that Wapda, which often found itself at the receiving end even for some of its minor lapses, should not be fully credited with a remarkable initiative it took recently.

To come to the point, contrary to general perception created by the media hype by Punjab government the relief in electricity rates was not Punjab-specific. It is meant to benefit farmers and is equally valid for all the provinces - Punjab, Sindh and NWFP. Balochistan is already enjoying the benefit of a reduced flat rate.

The initiative taken by the Wapda management, headed by its current chairman, was to manage load during peak hours to avoid excessive trippings and breakdowns and provide relief to the farmers through this incentive.

Punjab government has, however, decided to pick the expenditure of ToD meters on behalf of the farmers applying for these meters.

On Wapda's part all future tubewell connections will be given through ToD meters.

Wapda has started inviting applications for installation of 'Time-of-the Day' (ToD) meters on agricultural tube-well connections. This decision has been taken with a view to boost agriculture sector and provide relief to the farmers.

The distribution companies in NWFP, Punjab and Sindh have been directed to accept applications for the purpose with immediate effect. Balochistan is already availing concessional flat rates for agricultural connections hence this incentive is not applicable to the province.

Under this scheme, Wapda will provide electricity on concessional rates to the farmers running their tube-wells during off-peak hours from 10:00 p.m. to 06:00 a.m. through ToD meters.

The farmers from the three provinces will get a relief of Ps. 75 per unit on an average. This relief translates into a 25 percent concession in current agricultural tariffs. It may be pointed out that the rates have been reduced from Rs. 3.12 per unit to Rs 2.37 per unit in Sindh and Punjab and from Rs 2.75 per unit to Rs 2.10 per unit in NWFP for using electricity for tube-wells during off-peak hours.

Under a simplified procedure, the farmers can submit a hand written application on a plain paper along with the last paid electricity bill for tube-well connection to the respective Sub Divisional Officer for availing this facility.

Wapda has already procured ToD meters in sufficient quantity so that the farmers can benefit from this scheme without any delay. The cost of one ToD meter is approximately Rs 5,000.