The price Pakistan has to pay for power generation

ISLAMABAD: Doing business is getting tougher with each passing day. The power sector policy is now determined by deals concluded with private power producing companies.

The electricity they generate is the most expensive produced in this region. It will be right to say the power is being ‘produced’, instead of ‘added’ to the national system of transmission, as it is being generated, but not reaching the national grid. The payment is based on their capacity to generate, rather than their supply to the national grid.

Mindboggling calculations are made every minute in Pakistan to determine what amount each of these private producers would get from the national kitty on generation capacity. The cost of capacity and addition should be calculated separately and if the payment is delayed, the ‘financial cost’ – markup on due payments – makes the third head.

Published in The Express Tribune, 6th August, 2018