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    Power Division considering reconstituting power sector companies’ BoDs

    May 31, 2022 - Monthly Energy Updates


      The Power Division (PD) is seriously considering reconstituting Board of Directors (BoDs) of all the power sector companies, said reliable sources.

      They said the PD has also held discussions on ways to avoid condition of no removal of a BoD before the expiry of three years set by the Securities and Exchange Commission of Pakistan (SECP). They said the PD would ask the present members of these boards to resign voluntarily.

      It may be noted that Federal Minister for Energy Engr Khurram Dastgir had pointed out during his recent visit to Lahore Electric Supply Company (Lesco) that ‘performance evaluation’ of the boards would be carried out soon.

      According to sources, the PD has sought recommendations from the sectoral experts to finalize the process. They said the objective is to ensure power sector experts in these boards for smooth functioning of the companies. The PD officials are considering adding at least four sectoral professionals to each board. It has also prepared a list of former chief executives for this purpose.

      Meanwhile, a separate list of bankers and lawyers has also been prepared to induct in each board. However, they said, the priority of gender balance has failed to produce desired results, therefore, a review of this policy is also underway at present. Also, they added, the PD officials were pondering over provincial secretaries of energy as well as planning and development departments to the proposed reconstituted boards.

      At present, they said, over 40 ex-employees of K-Electric, Engro or Independent Power Producers (IPPs) have been inducted to these boards and share of the upcountry is not enough.

      Sources said the authority has also raised eyebrows over the presence of bureaucrats of PD in these boards as ex-officio members, allegedly manipulating situations mala fidely hiding facts.

      They said the NTDC BoD comprises 11 members including the MD NTDC as executive Director. Out of 10 non-executive Directors, five are ex-officio members from the Power Division and planning Division. The bureaucrats of Power Division are reported to be earning 1.5 to 2 million per month just on account of BoD meetings fee. Each bureaucrat of Power Division is reported to have 2 to 3 vehicles at his disposal attached from various power sector entities with unlimited fuel and maintenance expenditures. This is beside the pay and allowances and huge transport monetization allowance from national exchequer. Not only there is violation of corporate governance rules in the selection of these BoDs but also these members have conflict of interest.

      It may be noted that Senate’s Standing Committee on Power has also been deliberating the issue from time to time. Generally, it is believed that the BoDs of the distribution companies (Discos) are causing undue delays in taking decisions, resulting into shortage of staff. Also, the (BoDs) of all the 10 Discos are responsible for undue delay in the procurement of new electricity meters and clear the backlog. They said the BoDs are not ready to take immediate decisions to deal with the situation and the consumers have no choice but to bear with their inefficiency.

      However, sources close to these BoDs have clarified that they are bound to follow proper process of procurement procedure to protect the interests of the consumers. For example, they said, one prime reason behind a delay in procurement of electricity meters during the last two years was the cartelization of meter manufacturers, followed by another issue of the quality of meters. They have further pointed out that price escalation was another major factor behind delayed procurement during the pandemic of COVID-19.


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