PAKISTAN: Pakistan utility companies try to fight against chronic power cuts by employing strict measures to keep supplies available

Record ID: 618671

  • Title: PAKISTAN: Pakistan utility companies try to fight against chronic power cuts by employing strict measures to keep supplies available
  • Date: 30th June 2013
  • Summary: ISLAMABAD, PAKISTAN (RECENT) (REUTERS) PARTS OF CITY UNDER DARK DUE TO POWER OUTAGE SHOPS LIT BY BATTERY POWER SUPPLY OR GENERATORS IN THE AREA UNDER POWER OUTAGE LAHORE, PAKISTAN (RECENT) (REUTERS) MARKETPLACE ALONG STREET RICKSHAW DRIVER FANNING CARDBOARD IN SIMMERING HEAT KARACHI, PAKISTAN (RECENT) (REUTERS) RECEPTION OF CALL CENTRE STAFF AT WORK SIGN ON POWER PL
  • Embargoed: 15th July 2013 13:00
  • Keywords:
  • Location: Pakistan
  • Country: Pakistan
  • Topics: Nature / Environment,Politics,Energy
  • Reuters ID: LVA3P3LK6BYDXPNELNSX1JDVVH2
  • Story Text: Power cuts lasting 12 hours a day or more have devastated Pakistan's economy fuelling unrest in a nuclear-armed nation already beset by a Taliban insurgency.
    The only city bucking the trend is Pakistan's financial heart, Karachi - thanks to Tabish Gauhar and his team at the Karachi Electricity Supply Company (KESC).
    Half the city, including two industrial zones, do not have daily power cuts.
    Pakistan's current government won May elections partly because they promised to fix the power cuts. Now many are wondering if they will seek to repeat KESC's successful privatization.
    Gauhar said the process of running the power company was not without its stresses.

    "Its not a 9-5 job for me. When there is tension, I can't sleep at night. I think it has taken a heavy toll on my health, for sure, for the last three and half years. And you know, you just can not sleep at night when you there is a serious outage, when you know hundreds and thousands of people are suffering," said Gauhar, 42.
    Pakistan's power companies share similar woes. Staff are often corrupt. Influential families won't pay bills. The government sells power below the cost of production but pays subsidies late or not at all. Plants cannot afford fuel.
    At the state-run Peshawar Electricity Supply Company, most staff are illiterate, most new hires are relatives of staff.
    Thirty-seven percent of power generated there was stolen, a 2011 USAID-funded audit found.
    KESC had all the same problems when Dubai-based Abraaj Capital bought a controlling stake in 2008. Gauhar and his Abraaj team decided to slash the workforce by a third, cut off non-payers and destroy illegal connections.
    Redundant employees offered to work for free because they made such good money from bribes. When management refused, thousands of protesters ransacked KESC's headquarters. They camped outside for months.
    Gunmen attacked Gauhar's house. Workers crossed picket lines every day on the floor of police cars. More than 200 KESC employees were injured.
    After the protests dissipated, KESC's next problem was making customers pay. More than a third of KESC's electricity was stolen in 2009. Those who got bills often ignored them.
    KESC started cutting off those who didn't pay.
    KESC divided up the city of 18 million. Areas where 80 percent of people pay bills now have no regular power cuts. Areas with high loss - mostly poor - have long power cuts. KESC is widely hated there.
    Mohammad Talib, a supervisor at a lathe machine shop, says his neighborhood often has up to 10 hours of cuts per day. Summer temperatures top 40 degrees Celsius. Protests are frequent.

    "When we return home in the evening, there is a power outage there. Even then the KESC sends us huge bills. We cannot afford to pay those bills and that is why we use hooks (to steal power)," he said.
    Stealing power is easy and in Talib's neighbourhood, almost everyone does it. Makeshift wires with metal hooks latch onto KESC's lines. Some lead to roadside businesses. Others head into the distance atop lines of makeshift bamboo poles.

    "They (the hooks to steal power) go as far as one and a half and two kilometres. Although the voltage levels are low over there but you know, its good enough to run a fan or an electricity saver. And if you remove them which we often do, they are back again in five minutes or ten minutes, and law enforcement is not effective," said KESC manager Muhammad Siddiq.
    Mafias control the illegal lines and some slums are held by the Taliban or gangs where KESC staff can't even enter. There, they are experimenting with licensing powerful local businessmen to collect bills and cut off non-payers.
    But the painful reforms have begun paying dividends.

    "We had rolling blackouts about four, five weeks before they had curtailed the supply of gas to KESC but today we have no rolling blackout in our factories and in our houses also. Let's say, sometimes one hour and sometimes no. So, today, Karachi rolling blackouts is at the minimum if you compare with the other parts of Pakistan," said businessman S.M. Muneer, whose leather and textile factories employ thousands.
    Last year KESC made its first profit in 17 years. Theft has fallen by nine percent in four years.
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