October 26, 2023 (MLN): K-Electric (KE) held its 113th Annual General Meeting (AGM) for FY 2023. The meeting was chaired by Moonis Alvi – Chief Executive Officer, KE who was officially designated to do so by the Chairman of the Board, Mark Skelton.
The Chairman and most of KE Board members attended the meeting virtually, while KE leadership was present in person along with two Board members, namely, Adeeb Ahmad and Saad Amanullah Khan.
During the year, prevailing sociopolitical and macroeconomic challenges engulfed the country, which eventually set grounds for a severe economic crisis.
The company’s financial performance was significantly affected by this ongoing economic crisis, driven by factors like high inflation, increased policy rates, and economic contraction.
As a result, the company experienced a 7.3% reduction in units sent-out and a substantial decline in gross profitability by Rs15.72 billion. Exchange losses also increased by Rs4.38bn due to the devaluation of the Pakistani Rupee.
Furthermore, there was a Rs6.28 bn increase in impairment losses related to doubtful debts, influenced by high inflation and worsening economic conditions that decreased customers’ propensity to pay.
Increased finance costs by Rs19.45 bn, largely due to higher effective borrowing rates, led to a loss after tax of Rs30.90 bn.
Despite the tough economic challenges, KE remains steadfast towards infrastructure upgrades for improved services throughout its territory.
As such, the construction of the 500kV KANNUP-Karachi Interconnection (KKI) Grid, being the Company’s first flagship Grid at 500kV is progressing swiftly.
Similarly, the pre-commissioning activities of the 220kV Dhabeji Grid are also being expedited with the grid expected to commence operations in FY 2024.
Furthermore, during FY 2023, both Unit 1 and Unit 2 of KE’s 900 MW RLNG-fired power plant, BOPS-Ill witnessed successful commissioning and set off commercial operations during Q4 and Q3 respectively.
Meanwhile, the total transmission capacity was increased by 162 MVAs, taking net transmission capacity to 6,965 MVAs, through value addition of new power transformers, amidst planned upgrades in existing grids.
KE Leadership also shared that the company also increased its efforts to curb electricity theft and facilitate customers in clearing their electricity dues.
Over 100,000 customers have been supported through facilitation camps across the city, and 100 tonnes of kunda wires have also been removed by field teams operating round-the-clock.
Connections with long-standing dues are also being disconnected in line with the NEPRA Consumer Service Manual, the governing document for all distribution companies in Pakistan.
KE’s Investment Plan worth Rs484 bn, for the next control period (FY30) pending for approval from NEPRA is a testament to the company’s unwavering dedication to upgrading the infrastructure and ensuring a more reliable power supply for the region.
The Power Acquisition Program complements KE’s Investment Plan and envisions the addition of 2,272 MW of generation from renewable and indigenous sources.
By 2030, KE aims to have a share of renewables at 30% of its total supply for Karachi.
KE is simultaneously working on the renewal of the tariff for the next control period starting from July 1, 2023, with an aim to obtain a sustainable, cost reflective, and investment-enabling tariff with adjustment mechanism which is at par with other power sector entities to ensure continuity of reliable and smooth service to customers at optimal costs.
KE’s Generation petition for the remaining life of Generation plants and investment plan and performance KPls for Transmission and Distribution segment for the next control period are in advanced stages of finalization by NEPRA which will be followed with tariff determinations for transmission, distribution, and supply segments.
KE remains actively engaged with NEPRA for timely and sustainable tariff determination.
Due to pending tariff determinations, KE would not be able to issue the financial statements for the quarter ended September 30, 2023 and onwards till the tariff is finalised.
Copyright Mettis Link News
Posted on: 2023-10-26T15:53:24+05:00
