1. 1 PRESENTATION ON Financial Issues & Business Plan FY 2011 PAKISTAN POWER SECTOR

2. 2 Financial Issues

3. Power Sector Debt Parked in PHCL (Debtco) * Issuance of revised guarantees/payment of transfer fee 3

4. Receivable Status 30-9-2010 4

5. PAYABLE POSITION AS ON 8-11-2010 5

6. Delay in Payment of Subsidies by GOP FY 2009-10 6

7. Delay in Payment of Subsidies by GOP FY 2010-11 7

8. Impact due to delay in tariff FY 2009-10 8

9. Details Regarding GST Receivable 9

10. DisCos Tariff Determined and Notified 10

11. 11 Progress (July – Spet, 2010)

12. Billing, Collection & Recovery Ratio (July-Sept.) 12

13. Analysis of DISCO Losses (July-Sept.) 13

14. Analysis of Consumption Mix (July-Sept.) 14

15. Analysis of Generation Mix (July-Sept.) 15

16. 16 Business Plan FY 2011

17. 1Net Electrical Output on the basis of last three years actual figures and new IPPs and RPPs. The source wise energy is as follows :-(Values in MkWh) Business Plan FY 2010-11 ASSUMPTIONS FY 2009-10 Actual FY 2010-11 Projected i.WAPADA Hydel27,61229,486 ii.GENCO’S18,36412,036 iii.IPPs including SPP37,20734,854 iv.NEW IPP4,34012,712 v.RPP753,050 TOTAL87,58992,138 2 Revenue calculated on the basis of three month actual ( July – Sept. 2010) and projected Oct- June 2011 on the basis of GOP notified tariff effective 01-10-2010 3 RFO Rs 44046 M/Ton 4 Gas Prices @ Rs. 394/MMBTU 5 US Dollar rate @ Rs. 86.5/$. 17

18. 18 1 Quantitative Data NEO (MkWh) 92.138 Estimated Units Sales (MkWh) 73,369 Losses (%) 20.4% 2 Revenue/Tariff Required Bln. Rs. Rs./kWh % age Power Purchase Price 584.7 7.97 Prior year adjustment 32.40.44 Distribution Margin 76.61.04 Total 693.7 9.45 Less Revenue through Tariff 528.4 7.20 Gap (Bln. Rs.)(165.3)(2.25)-31.2% FINANCIAL OUTLOOK FY 2010-11 (Base Case Energy 92,138 MkWh)

19. Business Plan FY 2010-11 19

20. Net Revenue Gap after 2% Monthly Tariff increase FY 2010-11 20

21. Net Revenue Gap after 3% Monthly Tariff increase FY 2010-11 21

22. Issues  Unified Tariff.  Determined tariff to be notified by NEPRA.  Opening of LC by DISCOs for power purchase.  Payment arrears from GoP, KESC and Provincial Governments  Additional Gas allocation to Power Sector  Immediate GST Refund by FBR (Difference of input of output) of Rs. 27 billion)  Payment of GST on billing basis instead of Collection basis.  Governance issues of HESCO, PESCO and QESCO  Theft and non payment culture  Continued non payment by KESC  Unfavorable consumer mix  Unfavorable Generation mix 22

23. 23

24. Distribution losses FY 2009-10

25. DISCOs Determined and Notified Tariff

26. Monthly Estimated Revenue & Cost FY 2010-11

27. Receivable from GOP, KESC and Provincial Govts 27

28. Fuel Prices and US $ Statement 28

29. Impact of Fuel Price Adjustment 29