Five IPP owners have asked to terminate the PPAs or face consequences

• The IPPs said the government has already overpaid them.
• The authorities point out that the IPPs found a breach of the agreement with the government.
• Four IPP owners were invited to meet with members of the task force.

Islamabad: Owners of four Independent Power Producers (IPPs) established under the 1994 policy and another, established under the 2002 policy, have been warned of consequences if they do not voluntarily terminate their power purchase agreements and pay and resume operations. The News reported on Monday.

“The government will no longer pay capacity payments of Rs 139-150 billion annually to the said IPPs for the next 3-5 years, this is what the owners of the said five IPPs have been told. They were also categorically informed that the government has already made excess payments to the said IPPs in the form of capacity payments and equity returns and has also paid off the loans of the IPPs,” the officials privy to the matter said.

The owner of an IPP, officials said, told the key players of the IPP task force that if the government pays Rs 55 billion to his company, he will not only be ready to terminate the contract but also hand over the plant to the government.

“However, he was told that the government will not pay Rs 55 billion and will also not take control of the factory. He has the only option to break the deal himself.”

The task force authorities also pointed out that the management of the IPP was found to be in violation of the agreement with the government as it increased funding for other power plants by binding the plant, which is the denial of the contract. “So these injustices are enough to initiate criminal proceedings.”

“The owners have also been informed that their IPPs are also involved in defrauding the government by falsely showing losses to the O&M (operation and maintenance) head during 2020-24, making the undue profit in billions of rupees.”

The four owners, according to the officials, including the former petroleum minister during the PTI government, have been summoned to meet the main and powerful members of the task force on Saturday and the owners of the said IPPs have been told that they have no option but to terminate their agreements or forensic audit of their factories would begin and recover their past excess profits through wrongdoing and initiate proceedings against them.

A prominent business tycoon from Lahore, who also owns the power plants apart from other businesses in various sectors of the economy, will meet the authorities today (Monday).

However, the current Minister of Power Muhammad Ali is said to have offered the IPPs in question that he would ensure the establishment of the private power market regime in the next two years so that they can sell their electricity to business players in the economy after the shutdown her. electricity purchase agreements.