Summary
- The ministry further explained that the government cleared up that it will not pay any capacity payments to the tune of Rs139-150 billion per annum to these IPPs for the next 3-5 years.
- The authorities estimated that the government has already overpaid these IPPs on account of returns on equity and covered even loan payments.
- One IPP owner said his company will walk away from the contract and just hand over the plant if the government agrees to pay Rs55 billion.
ISLAMABAD: Five IPPs established under the 1994 policy, and one from the 2002 policy have been warned of consequences if these did not voluntarily terminate their power purchase agreements (PPAs) and shifted to a pay-and-take model.
The ministry further explained that the government cleared up that it will not pay any capacity payments to the tune of Rs139-150 billion per annum to these IPPs for the next 3-5 years. The authorities estimated that the government has already overpaid these IPPs on account of returns on equity and covered even loan payments.
One IPP owner said his company will walk away from the contract and just hand over the plant if the government agrees to pay Rs55 billion. But he was told there would be no such payment from the government, that all it was interested in did was to offer him an alternative to voluntarily call off the agreement.
The management of the IPP is charged with breaching the deal it had agreed to by pledging the existing plant to raise funds for other power plants contrary to the agreement.
In doing so, they might even be prosecuted under the penal code
Additionally, they have been charged with misleading the government by declaring losses in O&M since 2020 to 2024 and thereby garnering billions of rupees in unearned profits.
Four owners, including former state minister for petroleum from the PTI government, have been summoned to meet key members of the task force this Saturday. They have been issued a warning that failure on their part to end their agreements will see a forensic audit of their plants to recover excessive profits gained through wrongdoing.
A business tycoon hailing from Lahore, owns several power plants, and is operational in a large number of sectors. He will meet the authorities today. State Minister for Power Division Muhammad Ali assured the IPPs that a private power market regime would be created within two years enabling them to sell electricity to private entities after terminating their PPAs.
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