ISLAMABAD: The government experts are said to have tailored four options of ‘take and pay’ mode to be offered to 18 Independent Power Producers (IPPs) established under Power Generation Policies of 1994 and 2002, well-informed sources told Business Recorder.
“We will give final touches to available options for 18 IPPs to shift from ‘take or pay’ mode to ‘take and pay’ at the end of this week and most probably, calling notices will be issued to them next week, starting Monday,” the sources added.
However, it is yet to be decided whether turn of baggasse-fired power comes first or the 18 IPPs, as working on fuel component of baggasse power plants has also been completed, the sources maintained.
Govt stops payments to 18 IPPs ahead of negotiations?
The Central Power Purchasing Agency-Guaranteed (CPPA-G) has already stopped payments to 18 IPPs of 4,267 MW with whom negotiations will start for conversion of their pacts from take or pay to take and pay mode.
Chief Executive Officer (CEO), of an IPP told this scribe that there was no apparent reason to stop payments to 18 IPPs suddenly, except to pay some dues of Chinese IPPs as this issue will be centre of bilateral discussions between the Prime Ministers of both countries.
The Prime Minister Office (PMO) invariably directs the concerned Ministries to clear payments of Chinese companies. Previously, payments were made in the same fashion prior to the visit of Prime Minister Shehbaz Sharif to China.
According to the PPIB’s website, the individual capacity of each IPP, with whom negotiation is to start is as follows Uch-I Power Limited of 586 MWs( COD, October 18, 2000) Pakgen Power Limited of 365 MWs( COD, February 1, 1998), Liberty Power Daharki Ltd 235 MWs (COD September 10, 2001), Kohinoor Energy 131 MWs (COD, June 20, 1997), Fauji Kabirwala Power Company Limited 157 MWs (COD October 21, 1999), Attock Gen Limited (165 MWs)(COD, March 17, 2009), Engro Power Gen Qadirpur Limited 227 MWs( March 27, 2010), Foundation Power (Daharki) of 185 MWs( COD May 16, 2011), Halmore Power Generation Company 225 MWs (COD June 25, 2011), Liberty Power Tech Limited 200 MWs (COD, January 13, 2011, Hubco Narowal Energy Tech Limited 220 MWs(COD April 22, 2011), Nishat Chunian Power Limited 200 MWs (COD, July 21,2010, Nishat Power Limited 200 MWs (COD, June 9, 2010), Orient Power Company 229 MWs (COD May 24, 2010, Saif Power Limited 229 MWs( COD, April 27, 2010), Saphire Power Limited 225 MW(COD October 5, 2010) the first hydropower project i.e. New Bong Hydel IPP 84 MW of Laraib Energy Limited, (COD, March 03, 2013 and Uch-II Power Project of 404 MWs(COD April 4, 2014).
The sources said some of the IPPs have already given their consent for revision of their contracts mutually.
“We cannot remain oblivious to the crisis in power sector and have agreed in the national interest to negotiate to arrive at mutually agreed agreement in a fair and transparent manner,” said one of the Chief Executives of identified 18 IPPs.
The CEO of Liberty Daharki Power Company was amongst those owners of power plants who held initial meeting with the powerful circles and announced his consent on revision of agreement at a press conference.
Clarifying position of recent debate in the media that owners of five IPPs were pressurized for early termination of their contracts, the sources said that initially, they (IPPs) were conveyed that their contracts are being terminated without paying a single penny as they have already made huge profits.
However those who had this approach were convinced that scrapping of pacts in this way will have negative impact on future investments; and resultantly an atmosphere was created to sit with the IPPs and discuss their deviations from contracts and find out a mutually agreed formula to reach an amicable solution.
The sources said, due capacity payments of all five IPPs has been agreed, sans Late Payment Surcharge (LPS) despite the fact that at least four did not generate a single unit during the last one year. The five IPPs will get Rs 72 billion from the government as final settlement.
According to sources, Hub Power Company (Hubco) will get Rs 36.5 billion, Rousch Power, Rs 15.5 billion, Lalpir Power Company, Rs 12.8 billion, Rs 15.5 billion, Atlas Power Limited, Rs 6 billion and Saba Power, Rs 1 billion as final settlement. The applicability of termination of contracts was scheduled to commence from October 1, 2024.
One of the IPPs was assured that the government will facilitate their new project at the site of existing power plant.
The owners of five IPPs have refused to attend the signing ceremony of settlement agreements at the Prime Minister House.
Copyright Business Recorder, 2024
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