ISLAMABAD: Pakistan’s National Electric Power Regulatory Authority (NEPRA) acknowledged internal disagreements over Independent Power Producers (IPPs) contracts.
During a public hearing on the Central Power Purchasing Agency’s (CPPA-G) request for fuel cost adjustment (FCA) for June, NEPRA Chairman Waseem Mukhtar blamed the Power Division for the handling of IPP agreements.
He said that sovereign contracts cannot be unilaterally reopened, though requests can be made to the sponsors for review.
The CPPA-G had requested a positive FCA adjustment of Rs 2.63 per unit for June 2024. According to the CPPA-G CEO, consumers will see an FCA charge of Rs 3.33 per unit in their July bills, but will benefit from a Rs 2.63 per unit adjustment in August 2024, which will reduce their bills by Rs 0.70 per unit. This adjustment aims to recover an additional Rs 34.38 billion.
Mukhtar indicated that the actual reduction could be around Rs 0.75 per unit.
The hearing also addressed various issues, including a significant drop in demand, new generation plants, the transition of industry from the grid to solar energy, consumer tariff structures, peak hours, and the terms of IPP contracts.
In response to queries about revising IPP contracts, Mukhtar stated that while the Power Division handles IPP agreements, NEPRA can only provide assistance if the Division decides to move forward with such actions.
The scrutiny of IPP agreements continues to be a major topic of discussion across various forums, including among the business community.
