K-Electric On Gas Supply Issue From Sui Southern Gas Company
K-Electric On Gas Supply Issue From Sui Southern Gas Company: As per media sources due to a reduced gas supply, 500MW gas fired plants are not operational, creating an additional shortfall in the electricity system while Sui Southern Gas Company (SSGC) denied any kind of fuel shortage.
Currently Karachi Electric is receiving approximately 90 million metric cubic feet/day (mmcfd) of gas from Sui Southern Gas Company as against 276 mmcfd allocated by the Economic Coordination Committee of the cabinet. The gas requirement is estimated at 166 mmcfd. Due to insufficient gas supply Karachi electric has to pull the plug on its 500 megawatts of electricity production.
Karachi Electric is the country’s only vertically integrated power utility that produces electricity from its own generation units with an installed capacity of 2,267MW in addition to receive another 1,152MW from different other sources.
With the rise in temperature, the power demand touches 2,600MW and power shortfall is expected to increase. Due to short fall industrial customers will experience load shedding for more than four hours while residential customers will bear one hour per day.
Sui Southern Gas Company
SSGC has rejected the notion of reducing gas supply to Karachi Electric. As per government “gas load management plan” the company has to cater with the receiving of low gas supply from the fields and increase in domestic demand as its top priority.
SSGC is supplying gas on priority basis to all those customers with whom it has contractual agreements. As per SSGC they have no gas supply agreement with K-Electric and its increasing outstanding dues and they are providing reasonable amount of gas to the power company in the larger interest of the people of Karachi.
Late payment Surcharge (LPS) on KE
SSGC Officials said that KE is defaulter of Rs. 78 billion and the SSGC wants an agreement on a comprehensive pay plan along with acknowledgement of LPS. Principal amounts and dues are less than Rs.14 billion.
Karachi Electric have made payments close to Rs.10 billion since 2014 to bring outstanding principal amount to Rs13.7 billion.
KE on this matter stated that if LPS and markup are being demanded on the company’s payables then the formula should also apply on receivables. The matter of interest and LPS remains a pending court decision.
Consumers (both industrial and residential) have shown serious concern over power shortage ahead of Ramzan.