Energy Minister Awais Leghari announced that power purchase agreements with 11 Independent Power Producers (IPPs) including bagasse-based plants will be revised in the coming months and as a result, tariffs will decrease by up to Rs5 per unit.
Speaking at a briefing organized by the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) in Islamabad, Leghari emphasized that there are no “sacred cows” in the power sector.
The Energy Minister said that the federal government would stop purchasing electricity from Independent Power Producers (IPPs), signaling a significant shift in energy policy.
The minister revealed that contracts with five IPPs had already been terminated, with agreements being revised with 11 more, including bagasse-based plants.
“Electricity tariffs will decrease by up to Rs5 per unit after renegotiating agreements with additional IPPs,” Leghari said, noting that these measures are part of a broader effort to make electricity more affordable.
He criticized the high tariffs set by IPPs, saying, “If electricity is sold at such high rates, who will buy it? Moving forward, no such IPPs will be allowed to operate in Pakistan.
Leghari also outlined the government’s upcoming steps, stating that he would inform the federal cabinet next week about the decision to halt future electricity purchases. He lamented the absence of a long-term strategy for affordable electricity in the past. “We are changing that now,” he asserted.
The minister elaborated on the winter power package announced by Prime Minister Shehbaz Sharif, which offers a tariff of Rs26 per unit for consumption exceeding regular electricity usage. “This is a convenience package designed to benefit consumers, unrelated to seasonal demand,” Leghari explained.
Discussing the performance of distribution companies (DISCOs), Leghari highlighted a reduction in losses during the first four months of the fiscal year. “Losses have dropped to Rs11 billion compared to the projected Rs350 billion, thanks to improved management under the new board of governors,” he said.
Leghari also praised the role of the business community, saying it was instrumental in driving the nation’s economy. The government, he added, is committed to bringing top talent from both the public and private sectors to enhance operational efficiency in the energy sector.
