Axe falls on secretary power amid dispute over net hydel profit payments.

Byline: Khaleeq Kiani

ISLAMABAD -- After months of speculation, the government removed Secretary Power Irfan Ali on Tuesday following his disagreements with key authorities over a number of contentious issues, including net hydel profit (NHP) to provinces, unending circular debt, the procedure for induction of future power projects and ongoing problems with K-Electric.

A grade-22 officer of the Pakistan Administrative Service, Mr Ali was made an officer on special duty (OSD) and directed to report to the Establishment Division. He was immediately replaced by another PAS officer of same grade Omar Rasool who was presently working as secretary Board of Investment.

Mr Rasool had a debriefing session with Mr Ali on Tuesday before issuance of formal notifications.

In a related move, Secretary Commerce Yousaf Naseem Khokhar was also transferred as secretary Interior and was replaced by Muhammad Sualeh Ahmed Farooqi, who was currently working as special secretary commerce. The post of secretary interior was falling vacant on premature retirement of incumbent Azam Suleman Khan on Tuesday.

Secretary commerce also replaced

Informed sources said Mr Ali had earned the ire of Mr Azam Khan, the Secretary to Prime Minister Imran Khan, in December last year over the minutes of the Council of Common Interests (CCI).

The sources said the Power Division presented a report to the CCI on the issue of calculation of NHP under AGN Kazi methodology with the conclusion that the existing methodology was no longer workable given changing dynamics of the power sector.

The report argued that Article 161 of the Constitution promised NHP to the provinces on the basis of hydropower produced in a province and delivered to the national grid, which at the time of Kazi Committee methodology was restricted to mostly Tarbela and some other stations.

With changed dynamics and tens of thousands of megawatts coming from other sources, a levy of Rs1.15 had been imposed on every unit of electricity produced and consumed anywhere in Pakistan to meet NHP payments to provinces.

The practice envisaged over almost Rs170bn per annum to Khyber Pakhtunkhwa and its similar application on other provinces meant about Rs125bn payout per year to Punjab. As if that was not enough, similar payments would have to be made to AJK where thousands of additional megawatts are coming up. As such, it was argued that NHP was emerging as the bigger challenge to the affordability of electricity than the...