Islamabad:
Pakistan dissipated on Monday the impression that independent energy producers (IPP) are forced to review the agreements and transmitted to international development partners who had the option of moving away from negotiations or resorting to arbitration and forensic audit.
There has been a generalized perception that IPP have been coerced in the review agreements. The Government has taken an initiative to amend the agreements in an attempt to reduce capacity payments to IPP, which caused an increase in electric tariffs.
Consumers are paying RS2.5 billion at RS2.8 billion every year to those IPP that do not generate a single unit but receive considerable payments due to defective agreements. There are several defects in IPP contracts that the government is trying to rectify.
In a meeting with international development partners, Federal Minister Awais Ahmed Khan Leghari informed them that negotiations with IPP were free, fair and transparent with the option of moving away or resorting to arbitration and a forensic audit. Leghari attended a detailed session with the development partners in energy sector reforms and the way to follow.
The development partners were led by the director of World Bank countries, Najy Benhassine, and included representatives of the International Monetary Fund, Asian Development Bank, International Finance Corporation, KFW, German Embassy, Office of Investment of Investment of Infrastructure of Asian Infrastructure Infrastructure and Asian Infrastructure of the United Nations (FCOD) of the United Nations Fund (UNDP).
While stressing the importance of efforts to rationalize electricity tariffs for the economy, the Minister of Power assured the session participants that all negotiations with IPP were maintained in a free, fair and transparent way, according to the terms of their agreements.
He informed them of the reforms that Power’s division had undertaken to provide efficiency and discipline to meet the objectives, adding that electricity prices were being taken to more competitive and affordable levels for all consumers, particularly for the industry.
The reforms include the transition from the “Take or paid” to “take and paid” clause, elimination of oil -based plants from the oven and the conversion of the carbon imported in the local coal into the generation of energy.
Leghari said that an extensive and detailed study of energy generation was being carried out, which revealed that “we had not adopted the policy of less cost in the past, but now it will be the least cost.” He stressed that the government was taking measures to involve all development partners and, in that sense, had adopted an inclusive approach in the formulation and execution of policies.
Due to transparency, the Government has been able to reduce around 7,000 megawatts of the Indicative Generation Capacity Expansion Plan (IGCEP) of the total amount committed of 17,000 MW, saving a large amount of money in terms of expensive power.
The minister also pointed out the elimination of transmission limitations through the construction of Matiari Moro Ryk lines, Ghazi Barotha FSD lines, placing reactive power compensation devices and battery storage systems.
He highlighted the division process of the National Transmission and Exhibition Company (NTDC) in the Energy Infrastructure and Development Company (APMS (APMs).
Regarding the elimination of circular debt, the minister told the audience that the government wanted to create clear visibility and finish the task in five to eight years. The elimination of electricity duties and the rationalization of subsidies are other steps towards the rationalization of the electricity rate.
The rationalization of net measurement is also on the cards, which is adding a load of 150 billion rupees to the rest of the consumers.
In addition, inducing incremental demand through marginal prices and long -term packages for long -term planning are the need for the time, since no one is using surplus power, which adds to capacity charges.
Leghari informed the participants of the wholesale electricity market session, added that the government was not going to buy more electricity.
