ISLAMABAD: The Islamabad Electric Supply Company (Iesco) has deprived its consumers of Rs14.5 billion in the name of fuel adjustment surcharge, which has been declared illegal by the court and now Iesco has to pay back to the consumers, documents available with The News reveal.
Moreover Iesco sustained a loss of Rs13.502 billion during July 2011 to June 2012 alone while its liabilities exceed its assets by Rs13.54 billion. Islamabad High Court on October 24, 2012 declared the fuel adjustment surcharge being collected by the electricity distribution companies ordered by National Electric Power Regulatory Authority (Nepra) as illegal and void. In the wake of that order of the IHC audit conducted by an independent firm shows that the poor consumers were deprived of Rs14.55 billion during June 2009 to October 2012.
The audit report identified that “the company’s management based on its interpretation of the short order of Honourable Islamabad High Court dated 24 October 2012 has not reversed electricity sales revenue amounting to Rs14,554.34 million relating to the years from 30 June 2009 to 2012.
Had the electricity sales been reversed, loss for the year ended 30 June 2012 would have increased by Rs9,634.28 million with the effect of reversal of electricity sales for the year ended 30 June 2012 and Rs4,920.06 million with the effect of reversal of electricity sales relating to prior years and accumulated loss as at 30 June 2012 would have increased by Rs14,554.34 million”.
Regarding the overall losses, the audit report says, “It has been explained that the company incurred a net loss of Rs13,502 million during the year ended 30 June 2012 and, as of that date, the company’s current liabilities exceeded current assets by Rs13,540 million.
Consequently the Company has negative equity of Rs1,311 million at the year end notwithstanding the matter discussed in paragraph (a) above (Rs14.5 billion collected through fuel adjustment surcharge).”
Well-placed sources in Iesco told The News that these losses have occurred because of the Line losses and electricity theft; excessive expenditures; massive corruption (rewarding buddies by changing the category of their electricity meters e.g changing the commercial meter to domestic etc) and mismanagement.
It is worth mentioning here that the Islamabad High Court, on 24-10-2012 declared fuel adjustment charges in power bills ‘null and void’ and ordered National Electric Power Regulatory Authority (Nepra) to adjust the charged amount in the future.
The IHC heard the petitions against fuel price adjustment which were filed by more than 700 industrialists. Justice Shaukat Aziz had remarked that power distribution companies (Discos) cannot include the charges from previous bills into the fresh ones. The chief executive officer of Iesco and its spokesman couldd not be contacted.