Fourteenth Quarterly Progress Report: January - March 2014

Under Component 1, PDP conducted operational audits of MWP, all nine DISCOs, and NEPRA, and developed Action Plans for future interventions and projects. The goal of Components 2 and 3 is to execute jointly identified interventions in the Action Plans, codified in the PDP Work Plan, to improve sustainability in the power sector. Support for the Multan Electric Power Company (MEPCO) corporate turnaround activity began this quarter with the relocation of 12 PDP technical advisors to Multan. MEPCO demonstrated its commitment to PDP delivery by pledging over $2 million in match funding in the form of equipment, installation, office space, and other assistance. The procurement process for 80% of all services and equipment has been initiated, and several Technical Assistance (TA) activities have already kicked off, including organizational redesign, anti-theft initiatives, Customer Information System (CIS) delivery, and system mapping. PDP continued to see improved financial and operational performance at Peshawar Electric Supply Company (PESCO). The DISCO confirmed an additional $12.2 million in increased revenue and decreased losses over the first seven months of its fiscal year. PESCO's Aggregated Technical and Commercial (AT&C) losses reduced by an additional 1.7% compared to the same period last year, while collections increased by 4.5%. This indicates a strong indicator of FY 2012-13 results being sustained into FY 2013-14. PDP played a significant role in helping PESCO, NEPRA, and MWP win a major victory this quarter. The Supreme Court overturned the Peshawar High Court's decision blocking PESCO from charging its customers a fuel cost adjustment (FCA) charge. As a result, PESCO will now be able to collect approximately $400 million in revenues and subsidies. PDP contributed to this outcome through highlighting the FCA issue in the 2012 Circular Debt Report, revising roles and responsibilities related to the tariff determination process, and providing advice and support to the legal advisor appealing the FCA decision. The PDP continued to work closely with the DISCOs, MWP, and NEPRA to address the challenges facing the power sector. The program's efforts are focused on improving the commercial performance of the DISCOs, enhancing the efficiency of the MWP, and strengthening the regulatory framework of NEPRA. The PDP's progress is a testament to the commitment of the USAID, IRG, and the Pakistani government to improving the power sector's sustainability and reliability. The PDP's success is evident in the improved financial and operational performance of the DISCOs, particularly PESCO. The program's interventions have resulted in increased revenue, decreased losses, and improved AT&C losses. The PDP's efforts have also contributed to the Supreme Court's decision in favor of PESCO, allowing PESCO to collect additional revenues and subsidies. The PDP's continued support to the power sector is crucial to achieving the program's goals. The program's focus on improving the commercial performance of the DISCOs, enhancing the efficiency of the MWP, and strengthening the regulatory framework of NEPRA will have a positive impact on the power sector's sustainability and reliability. The PDP's progress is a testament to the commitment of the USAID, IRG, and the Pakistani government to improving the power sector's performance and ensuring a reliable and sustainable energy supply for the people of Pakistan.