Islamabad, Sep8: According to Energy Minister Awais Leghari, in a recent interview with Reuters, the federal government is renegotiating contracts with independent power producers (IPPs) in an effort to lower electricity bills nationwide.
The energy minister stated that the government and IPPs both agreed that the status quo could not last and that the current power pricing structure was no longer sustainable. He suggested that in order to find a long-term solution that works for everyone, all parties involved would have to make some compromises.
The government has passed on additional fixed expenses and capacity charges to customers due to a lack of funding. In the meantime, certain responsible leaders of the ruling coalition are pressing for the removal of payments for wasted power, a cap on the exchange rate for US dollar payments, and a reduction in guaranteed returns.
Leghari admitted that both residential and commercial customers could not afford the present electricity costs. According to him, the government wants to lower commercial customers’ tariffs from 28 cents to 9 cents per unit.
Leghari stated earlier in the week that a thorough examination of IPP-related matters had been finished and that good news would be revealed shortly. But he also issued a warning: the government cannot unilaterally change agreements without running the risk of going to court. Therefore, any modifications to the contracts would have to be agreed upon by both parties.
