Power Distribution Companies (Discos) have reportedly pledged 33 percent of their bills' recovery from consumers to the federal government for five years to pay Rs 151 billion loan facility arranged through debt swap deals with banks, well informed sources told Business Recorder.
Power tariff will be increased across the board to fund about Rs 18 billion (Rs 4.67 billion per quarter) interest on Term Finance Certificates (TFCs) per annum on the loan facility extended by 16 banks to transfer credits to the accounts of power holding company limited (PHCL).
Earlier banks were reluctant to extend loans to the power sector, saying that their exposure in power sector has already crossed reasonable limits. "We have finalised arrangements for Rs 136 billion to resolve inter circular debt whereas formalities for the remaining amount are underway with the banks," the sources added.
The names of banks and amount being transferred to the PHCL's books are as follows: Allied Bank of Pakistan(ABL) Rs 21.01 billion, Askari Bank Limited Rs 9.98 billion, Habib Bank Limited(HBL) Rs 23.32 billion, Muslim Commercial Bank(MCB) Rs 8.932 billion, Atlas Bank Rs 6.72, National Bank of Pakistan (NBP) Rs 20.19 billion, Bank Al-Habib Limited Rs 5.25 billion, Samba Bank Limited Rs 800 million, NIB Rs 3.18 billion and Habib Metropolitan Bank Rs 3.33 billion, Faysal Bank Limited, Bank-Alfalah Limited, Citi Bank, Soneri Bank Limited, Summit Bank and the Bank of Punjab also extended signed debt swap agreements with GoP, however, the amounts are not known.
The sources said 31 Independent Power Producers (IPPs) and others would benefit from the debt swap deal. Some of the IPPs whose credit lines are cleared from the banks are as follows: Hub Power Project Rs 34.704 billion -Fauji Kabirwala Power Company Rs 1.74 billion- Rousch (Pakistan) Power Limited Rs 5.167 billion - Attock Gen Limited Rs 6.8 billion- Atlas Power Limited Rs 3.8 billion - Engro Energy Limited Rs 1.94 billion- Foundation Power Company (Daharki) Limited Rs 1.56 billion - Halmore Power Generation Company Limited Rs 834 million - Hub Power Project, Norwal Rs 5.114 billion - Liberty Power Tech - Nishat Power Limited - Nishat Chunian Limited - Orient Power Company Limited - Saif Power Limited Rs 1.56 billion - Sapphire Electric Company Limited Rs 2.539 billion, Chashma I and II Rs 91.75 million, Kot Addu Power Company(Kapco) Rs 35.40 billion.
AES Lalpir Limited - AES Pak General (Pvt) Limited - Altern Energy Limited - Habibullah Coastal Power (Pvt) Co - Japan Power Generation (Pvt) Limited - Kohinoor Energy Limited - Liberty Power Project, Saba Power Company Limited - Southern Electric Power Company Limited - Uch Power Limited, Liberty Power Tech. Nishat Power, Nushat Chunian and Orient Power Limited. The sources said that IPPs would clear the dues of Pak Arab Refinery, Pakistan Refinery and Pakistan State Oil (PSO) which have refused to supply furnace oil on credit.