Govt to review and ‘terminate contracts with 15 IPPs’

The Pakistani government has decided to review and terminate agreements with 15 Independent Power Producers (IPPs) to provide relief to the public burdened by high electricity costs, sources said on Thursday.

In efforts led by Energy Minister Awais Leghari, a task force has finalised the framework to address the issue. The government plans to immediately end contracts with six IPPs established in the 1990s and gradually phase out agreements with nine others.

Sources revealed that contracts with Gul Ahmed Energy Limited, Kohinoor Energy, Liberty Power Project, Tapal Energy Limited, Attock Generation, and KAPCO will be terminated without extension. Additionally, agreements with Lal Pir, Pakgen, Fauji Kabirwala Power, Habibullah Coastal, Japan Power Generation, Saba Power, Hubco, Southern Electric Power, and Rousch Power will be phased out over the next three to five years.

The government is also preparing a framework for consumers using over 201 units of electricity. The policy regarding the same slab for consumers exceeding 201 units for six months will be revised. Special slabs will be introduced for these consumers, with a proposed rate of Rs26 per unit for those exceeding 201 units.

Federal Minister Awais Leghari emphasised the importance of the energy sector for the economy, stating, "We are implementing reforms in the energy sector and will ensure their execution."

He underscored the need for coordination in implementing these reforms, highlighting the role of the national task force in overseeing the 20-point reform agenda. "The sooner we address these issues, the quicker the economy will stabilise," he added.