ISLAMABAD: The Power Division on Thursday refused to share current status of critical negotiations of Task Force on Power Sector Reforms with Independent Power Producers (IPPs) but insisted that good news will be given soon as talks with a few IPPs are at an advanced stage.
This was stated by Special Secretary, Power Division, Arshad Majeed, concurrently also Secretary of the Task Force, in response to a volley of questions by committee members on the current status of negotiations with 91 IPPs.
The National Assembly Standing Committee headed by Muhammad Idrees did not insist on details of talks with the IPPs but some Committee members argued that contracts with IPPs have ruined the country; and asked for identification of those administrations who inked these pacts, payments made to the IPPs so far and which IPPs are getting paid without any generation.
Govt set to announce revised deals with IPPs
The Committee members further contended that the information shared with them on duration of contracts, capacity payments and other related matters is incomplete, and urged Power Division to share details in a presentation.
“IPPs issue is the most burning issue of Pakistan. Currently, burden on consumers is by the IPPs and there are also reports of deaths due to exorbitant bills,” Dr Mahreen Bhutto maintained.
Rana Muhammad Hayat, MNA, said that the entire country has eyes on the government and the Standing Committee with regard to the outcome of the much talked about negotiations with the IPPs.
Arshad Majeed revealed to committee members that the Minister for Power Awais Leghari chairs meetings of the eight Member Task Force whereas SAPM on Power, Muhammad Ali, is the co-chair. Other members of the Task Force are: Lt. General Zafar Iqbal, National Coordinator for this Task Force, Commander Air Defence, Additional Secretary, Muhammad Zakria, Chairman NEPRA, Chief Executives, CPPA-G and a representative of PPIB.
“Right now negotiations are underway. We are at a very critical advanced stage with some IPPs and if details of those negotiations are disclosed at this stage, this will not be suitable for the country and the sector. After two weeks, we will be in some position to brief the Committee about the outcome of the negotiations,” he added.
Power Division Secretary Dr Fakhar Alam Irfan assured the Committee that Power Division has already shared PPAs Model Agreement but if the Members request individual pacts can also be presented before the Committee.
He further said that since the Task Force on IPPs is in negotiations with the IPPs, CEO CPPA-G is also a Member of the Task Force, and sought time for forwarding the recommendations of the Task Force on IPPs.
Responding to a question, he said that revised PPAs, which will be finalized in consensus with IPPs, will bring down electricity prices, however, he did not indicate financial impact of revised PPAs.
“Task Force has done wonderful work and interacted with the IPPs. Legally, we are bound to honour the agreements and cannot alter the pacts unilaterally.
The report will also recommend which IPPs can be retained or their pacts be scrapped,“ he said adding that Power Division is not in a position to reveal what treatment will be given to each IPP. He said unilateral revision will attract international arbitration and subsequently a penalty maybe imposed.
Federal Minister, Amir Muqam said that the government and opposition are on the same page on IPPs contracts revision.
Copyright Business Recorder, 2024
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