Govt pays Rs53 billion to seven IPPs under revised agreements

The government has made payments totaling Rs53 billion to seven Independent Power Producers (IPPs) under revised power purchase agreements (PPAs) and implementation agreements (IAs). 

The payments were made as part of efforts to reduce the financial burden on the national power sector and ease the fiscal pressure.

According to a news report, Liberty Power received Rs5.27 billion, Narowal Energy Rs9.68 billion, Nishat Chunian Rs6.67 billion, Nishat Power Rs9.63 billion, Engro Powergen Qadirpur Rs8.04 billion, Saif Power Rs6.49 billion, and Saphire Electric Rs7.05 billion. 

The federal government also secured written confirmation from the IPPs stating that they had voluntarily signed the agreements, without any form of duress.

The agreements were part of ongoing efforts to reduce the cost of electricity and improve the financial position of the power sector. The government and the IPPs agreed on amendments to existing PPAs, adopting a “Hybrid Take-and-Pay” model, which will help streamline payments and further reduce the burden on consumers. 

The revised agreements also introduce new terms on tariff indexation and force majeure conditions, ensuring stability and transparency for both the government and investors.