MEPCO Bought Electricity Worth Rs. 98 Crore Without NEPRA Approval

The Public Accounts Committee’s subcommittee was informed on Monday that the Multan Electric Power Company (MEPCO) purchased electricity worth Rs. 988.7 million from captive power plants without obtaining prior approval from the National Electric Power Regulatory Authority (NEPRA). According to an audit briefing, MEPCO signed a power purchase agreement with one entity in 2010 for the supply of 10.5 MW of electricity, but only notified NEPRA in 2011. Audit officials stated that entering into such agreements without NEPRA’s consent violates regulatory rules. A committee member questioned whether any disciplinary action was taken for this irregularity. Officials responded that the Departmental Accounts Committee (DAC) had ordered an inquiry. The Lahore High Court Multan Bench later ordered a halt to the recovery process. The PAC had declared the matter sub judice in 2015 and 2017. MEPCO resumed recovery in 2017 based on NEPRA’s decision, but the case remains under litigation. Secretary Power noted the latest court hearing took place on May 20, with the next hearing scheduled for June 18. In a separate audit observation, officials highlighted that MEPCO procured 2,188 transformers made from defective material and incurred a loss of Rs. 461.5 million. MEPCO conducted an internal inquiry and held three local manufacturers responsible. The case was later taken up by the National Accountability Bureau (NAB), but it was closed after NAB found no evidence of scrap being used.