KWSB warns of massive increase in bills

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The Karachi Water & Sewerage Board (KWSB) warned on Tuesday that it would be forced to increase water bills by 300 to 400 percent if its plea to change its electricity tariff structure from the commercial/industrial category to the non-commercial one was not met.

Speaking at a press conference, Managing Director KWSB Misbahuddin Farid strongly protested against a recent decision of the National Electric Power Regulatory Authority (Nepra) to dismiss the water utility’s tariff petition that sought a change in the industrial/commercial nature of the electricity tariff being levied on it for electricity billing.

He gave vent to his ire against the Nepra’s decision on the grounds that the KWSB’s office complex near Karsaz on Sharea Faisal had been deprived of a regular power supply by the Karachi Electric Supply Company (KESC) on account of a prolonged issue of massive electricity dues payable by the water utility.

However, relevant circles said the KWSB management wrongfully moved Nepra for tariff determination, which in most of the instances considered tariff petitions of only power generation and distribution companies, as eventually the tariff issue had to be settled amicably between the city’s power and water utilities.

But the KESC and KWSB managements normally avoid negotiations on such issues due to their already estranged relationship over the issue of electricity dues.

“Being the managing director of the water board I strongly agitate against Nepra’s decision to dismiss our tariff petition as eventually this decision would go against the interest of a large number of residents, business owners and industrialists who deserve water supply at most affordable rates,” said Farid.

“It is unjust to levy sales tax and high electricity tariff on the water utility, and in case the same was passed on to consumers it would result in a massive increase in water bills, but still the water board’s management has been avoiding such sheer anti-consumer moves.”

Farid said: “It is utterly wrongful to treat the water utility as a commercial/industrial institution since 90 percent of its consumers are residential ones, while even for the rest of the 10 percent industrial consumers, water is being supplied at relatively discounted rates.

“Being a strategic utility organisation, the water board has been engaged in the vital public cause of fulfilling ever-burgeoning water needs of Karachi, whose residents and industrialists should be served in the best manner as they constitute part of the mini-Pakistan and main industrial hub of the country.”

The KWSB chief said that the persistent levy of industrial/commercial electricity tariff on his department would mainly cause a massive increase in its operation and maintenance (O&M) costs, which in turn would cause further financial problems for the utility in fulfilling water needs of the consumers.

He said the O&M costs had already been on the higher side due to the operation of heavy pumping, filtration, and sewerage machinery as well as other installations.

Nepra dismissed the tariff petition in a summary without giving plausible grounds for doing though the majority of the interveners at a Nepra’s public hearing on the petition supported the just cause of the water board, he added. The interveners included representatives of the Karachi Chamber of Commerce & Industry, industrialists, cantonment boards of the city and the finance department of Khyber Pakhtunkhwa.

He noted that in various sections of its response to the tariff petition Nepra upheld the stance of the water board by stating that 80 percent of electricity billing of the utility was being paid under the commercial mode despite the fact that the KWSB should not be considered as a commercial or industrial consumer for the electricity supply.

Nepra also conceded that other water and sewerage bodies of the country were being billed under the agriculture mode while it was necessary that a separate power supply tariff mode should be determined for the strategic utility organisations like the KWSB, considering their public welfare role, he further argued.

“Nepra’s decision makes it quite clear that the power sector regulator gives preference to the interests of a private sector entity despite the fact that its terms of reference call for giving due justice and relief to the consumers and overcoming shortcomings of the utilities.

“The water board strongly agitates against the decision of Nepra for dismissing the concrete stance of the KWSB without any solid basis while extending undue favour to a private sector power utility. Instead, the water board has been advised to prevent water theft and stop other leakages in its system, which has nothing to do with the issue of electricity tariff.”

Farid said that after Nepra’s decision, the KWSB had been left with only two options, i.e. to increase the water bills by up to five times in order to cover its ever-increasing O&M costs, electricity charges, fuel charges, and general sales tax, which totalled Rs1.5 billion on monthly basis; or to move the superior court in order to continue with the normal practice of the water board of supplying water to the residential and industrial consumers at subsidized rates. Answering a question, he said that at present the KWSB had been incurring Rs500 million monthly losses and also paying an electricity bill of Rs50 million a month.

 

Courtesy: The News


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