ISLAMABAD: The government has successfully renegotiated agreements with eight bagasse-fired Independent Power Producers (IPPs), achieving substantial financial savings estimated between Rs 85-100 billion. These revisions include a reduction of Rs 8 billion from the Rs 22 billion recently approved for upward tariff adjustments.
Among the sugar mills signing the revised Power Purchase Agreements (PPAs) are Hamza Sugar Mills, Chiniot Sugar Mills, and others. Key changes include lowering the rate of bagasse from Rs 5,600 per ton to Rs 4,500, with a 5% retrospective deduction. The renegotiated deals are expected to save the country over Rs 100 billion in future payments.
Special Assistant to the Prime Minister, Muhammad Ali, confirmed the amendments, with provisions linking bagasse prices to local market indices rather than international coal prices. The revised agreements will be effective from October 2024.
Story by Mushtaq Ghumman
