ISLAMABAD - The government yesterday admitted in the Senate that 'biggest oil lobby' in the country was the main hurdle in the way of replacing costly oil for power producing plants with other alternates of cheap fuel.

Water and Power Minister Khawaja Muhammad Asif, concluding the debate in the upper house on an adjournment motion on the recent report of National Electric Power Regulatory Authority (Nepra), said, "The biggest oil lobby in the country does not want to replace the oil with other alternates of fuel like coal to run power producing plants".

The minister said that power plants used to sell oil provided by the government instead of using it for the production of power. "They use minimum oil of low efficiency and sell rest of the oil in the open market," he said and added, "There is a big oil lobby in this country where oil of worth 16 billion dollar is imported. They sell the oil and don't want to replace oil with other fuels".

“In India, 60 percent electricity is produced through coal and we don't produce even a single megawatt with it which is the cheapest. We want to shift on coal but we are facing resistance,” he said, adding, the government was facing the same resistance in the import of LNG.

The minister also demanded ‘heat audit’ of all the power plants run by oil.

“The heat rate audit will determine the actual consumption of oil by power sector," he said.

He added that the extra profit earned by power plants should go back to the consumers. Opposition lawmaker Noman Wazir Khattak later said that demand of minister was irrational as "no one but the Ministry Of Water and Power itself had to conduct heat audit".

Criticising Nepra, the minister said that authority was a regulator that had been established to regulate private power sector but it had started regulating the state.

Clarifying some allegations of the opposition benches, the minister said that only 0.3 million 'time of the day' meters had been installed for out of total 20 million consumers. The Nepra in its report said that 70 percent of these meters were faulty and this became 1.04 percent of the total meters installed. He admitted that the government used to shut down those power plants that produced costly electricity up to Rs 42 per unit after maintaining the scheduled load shedding.

The minister said that the country had 23,000 MW ‘name plate’ capacity of power production, which had de-rated over the years, and now it was 18,000 to 19,000 MW. "We generated 16,890 MW electricity this summer, he said.

Kh Asif said that government was ready to hold audit of Nandipur Power Project through any government agency like NAB and non-government agency like UN or Asian Development Bank.

"If opposition wants to get a judicial commission formed, we are ready," he said. The forensic audit of the project had already been done and the government was ready for commercial and accountancy audit.

The minister said that privatisation of K-Electric as single entity was the wrong decision as a public sector monopoly was handed over to the private sector monopoly in that way. Despite having capacity, K-Electric did not generate the required electricity as it got 650 MW from the national grid. It has only invested money on transmission lines in those areas of Karachi where it got more revenue. The government was trying to rectify this privatisation transaction, he concluded.