ISLAMABAD: The federal government’s negotiations with several Independent Power Producers (IPPs) have started to yield results, with four IPPs—Atlas Power, Saba Power, Rousch Power, and Lalpir Power—agreeing to prematurely terminate their Power Purchase Agreements (PPAs). Hubco is expected to finalize a similar deal in the coming days, well-informed sources reported.
The government’s Task Force on the Power Sector, consisting of security officers, legal experts, and representatives from SECP, PPIB, CPPA-G, and Nepra, played a pivotal role in persuading IPPs established under pre-1994, 1994, and 2002 policies to renegotiate their agreements.
The federal government estimates that the early termination of these contracts will save Rs 325 billion over the remaining 3-10 years of the five IPPs’ operational terms. Although the government has agreed to settle previous capacity dues, disputes remain with Hubco over a Rs 1 billion claim. The government is resisting IPP demands for interest on delayed payments, as some producers allege defaults on prior agreements.
These efforts aim to lower consumer electricity tariffs, with Power Minister Sardar Awais Khan Leghari projecting reductions of up to Rs 7 per unit.
Story by Mushtaq Ghumman
