KARACHI: Kot Addu Power Company Limited (KAPCO) announced on Wednesday that it has not received any “capacity payments” from the government since its power purchase agreement (PPA) expired in October 2022.
Addressing recent reports, KAPCO clarified that it has not been paid for generating electricity in the past 22 months. The company has only received overdue receivables related to the period up to the end of the PPA on October 24, 2022, which have been duly reported in its financial statements.
Following the expiration of the PPA, KAPCO’s power plant has remained in preservation mode due to the lack of an operating regime. The company’s tariff application is currently pending a final decision from the National Electric Power Regulatory Authority (NEPRA).
KAPCO’s original PPA, signed in June 1996 during its privatization, was set for 25 years, expiring in June 2021. The PPA was extended by 485 days until October 24, 2022, to settle a dispute over liquidated damages. During this extension, KAPCO did not receive capacity payments but was required to keep its plant available for generation.
Additionally, KAPCO has provided a 220KV-132KV switchyard to the power purchaser at the ministry’s request, without compensation, to support the MEPCO Region’s consumers and the national grid’s operations.
