Payment settlement between KE, govt entities: PM directs PD to present ‘holistic’ solution

ISLAMABAD: Prime Minister Shehbaz Sharif has directed the Power Division to present a holistic solution for settlement of historic receivables and payments between K-Electric (KE) and government entities/departments, well-informed sources told Business Recorder.

He issued these directions at a recent meeting, wherein different issues of power sector came under discussion.

The Power Division and Cabinet Division, which is administrative boss of NEPRA, will cooperate with the latter for early tariff and settlement of claims of KE. The NEPRA has announced hearing dates on tariffs of KE.

KE issues stern warning to Sindh govt over dues

On the issue of shareholding matters, the Prime Minister has directed that the legality of shareholding matters be examined by the Securities and Exchanges Commission (SECP) and a report be presented to him at the forum of SIFC.

It was also decided that competitive bidding of Category -III wind Letter of Interest (LoI) holder be conducted to procure 300 MW for KE.

The meeting was informed that draft RFP documents were prepared by PPIB and sent to KE on March 15, 2024. RFP/EPA approval timeline by PPIB Board is end June 2024 and by NEPRA it is end August 2024.

At a recent meeting at the Prime Minister Office, Chairman Nepra stated that Nepra is evaluating KE’s write-off claims and the Authority is working to resolve the matter at the earliest. The issue of recovery loss is also prevalent in other DISCOs. However, since they are government-owned, this loss is parked in the circular debt or is ultimately received from the consumers through the imposition of a surcharge.

On tariff-post 2023, CEO KE who also attended the meeting said that power utility company’s Multi-Year Tariff (MYT) expired on June 30, 2023, and KE has filed tariff petitions for the next control period with Nepra. Chairman Nepra noted that they were working on it and assured that the tariff determination process for the period post June 30, 2023 would be expedited.

Sharing details on Indicative Generation Plan for KE, Secretary Power, Rashid Langrial stated that as per directives of the Prime Minister’s Office, KE submitted an Indicative Generation Plan (IGP) that included the following projects: (i) 660 MW JPCL Coal Unit-I after its conversion to 100 percent Thar Coal; (ii) 660 MW JPCL Coal Unit-II based on 100 percent Thar Coal; (iii) new 330 MW Thar Coal Power Project through Competitive Bidding jointly done by PPIB and KE; (iv) 600 MW HUBCO conversion of two (02) units to 100 percent Thar coal; and (v) 1,320 MW Port Qasim Electric Power Company Limited (PQEPCL) conversion to 100 percent Thar Coal and Novation of its PPA to KE.

During discussion on government’s representation on KE’s Board of Directors (BoDs), Secretary Power requested to change/substitute the Government of Pakistan board members in KE’s BoDs as the stay order of SHC does not apply to Government of Pakistan board members.

The participants mutually agreed on the following decisions: (i) Nepra to resolve the issues of KE including write-off claims and determination of tariff post-June 2023; (ii) summary for approval of the CCoE for conversion of unit-I of JPCL to 100 percent Thar Coal and power off-take by KE; and (iii) KE to assist the shareholders in changing the Government of Pakistan Board Members in KE BoDs.

Copyright Business Recorder, 2024