LAHORE: As the government of Pakistan is unable to fully reimburse the current bills of the IPPs (independent power producers), the outstanding amount is projected to rise to Rs60bn ($618.55m) at the end of this month from $577.31m on December 3.
A senior executive of one of the power producers alleged that the government is making illegal deductions from their capacity payments in violation of power purchase agreements.
The group includes Nishat Power, Halmore Power, Sapphire Power, Liberty Power, Orient Power, Atlas Power, Saif Power and Nishat Chunian Power with a combined capacity of 1,600MW.
All of them have been set up under the power policy of 2002. The IPPs refute government claim of having paid 90 percent of their dues.
“The IPPs are not even getting their full current bills. How can the government pay us 90 percent of the outstanding dues when it is defaulting on our current bills?” asked an executive of another IPP.
The government owed Rs37bn on Dec 3 to IPPs for electricity supplied after July 13 - the cut-off date between the amount of arrears and current billing as per orders of the Supreme Court.
A few months back, these IPPs had moved Supreme Court after the government defaulted on its sovereign guarantee in July.
On court’s orders, both the government and the IPPs agreed after reconciliation that the outstanding amount stood at Rs45bn.
On the directives of apex court, the government promised to pay Rs24bn in three instalments from August to October.
The remaining Rs21bn were to be paid in nine monthly instalments, starting from Nov 20.
According to IPPs management, the SC further directed the National Transmission and Despatch Company (NTDC) on Aug 15 to make up-to-date payment of the current billing of the petitioners in accordance with the power purchase agreement.
The court ordered that the NTDC should not default in making payments of the current bills so that the outstanding balance may not pile up again.
But the NTDC failed to implement court directives and the outstanding amount increased to Rs56bn and may cross Rs60bn by the end of Dec, said the executive, who requested anonymity.
The NTDC is only paying about 59 percent of the current billing to the IPPs.
“The IPPs billed Rs90.538bn to the NTDC for the power supplied from July 1 to Nov 30 but the NTDC made payment of only Rs53.424bn, which is 59 percent of the billed amount.”
“The remaining amount of Rs37.114bn is still outstanding,” he said, adding that payment of Rs19bn of arrears was also pending.
The IPPs claim that their efficiency was highest among all thermal power plants.
“Ours are the most efficient plants in the country and according to economic order we should be given priority in payments for purchase of fuel to operate at our optimal capacity,” he claimed.
He alleged that the government had already wasted Rs18bn during the current calendar year by giving priority to inefficient plants in the provision of fuel.
Internews
