The finance ministry has been directed to pay Rs31.1 billion, while the remaining amount of Rs10 billion will be arranged by the Pakistan Electric Power Company (Pepco).
The prime minister issued the orders at a special meeting he chaired in the federal capital on Tuesday. The meeting reviewed the situation of circular debts arising from pending payments to the PSO.
A top official of Pepco told the meeting that the company would be able to partially clear PSO’s bills by the end of this month from the recoveries it has made so far.
A national energy summit in April had recommended the government to quickly clear circular debts. According to official data, different government departments still owed Rs130 billion.
Circular debt is one of the major reasons responsible for below-capacity production of Independent Power Producers (IPPs), causing frequent, prolonged power outages in the country.
An official survey released recently put losses to the national economy caused by circular debts at 2.5 per cent of Gross Domestic Product (GDP).
Premier Gilani said that the provinces were not honouring what they had committed at the energy summit in Islamabad to reduce power shortfall in the country.
The four provinces were to make sure closure of business centres at the sunset (2000 hours) to save electricity consumption. It was followed across the country for a month but provincial authorities have of late been lenient on implementing it in letter and spirit.
But the prime minister said it must not happen. “All stakeholders particularly, provincial governments, should honour the commitments they had made at the energy summit and pay their outstanding dues of electricity to help reduce circular debts,” he added.
Earlier, Minister for Petroleum and Natural Resources Naveed Qamar briefed the meeting about the gravity of the situation arising out of delay in payments to the PSO by various power companies.
Minister for Water and Power Raja Pervez Ashraf apprised the meeting of delay in payments by provincial governments as per commitment in accordance with the energy summit.
Published in the Express Tribune, June 16th, 2010.
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