The Senate Standing Committee on Power on Wednesday grilled the Power Division over its failure to provide clear answers on the cost and efficiency of the IPPs, the unchecked rise in circular debt and persistent electricity load-shedding during peak summer months.
The committee, chaired by Senator Mohsin Aziz, expressed strong dissatisfaction with the Power Division's lack of transparency.
"We asked for a global comparative analysis of IPP power plants over a year ago, but no data has been shared," Senator Aziz said. He lamented the division's continued reluctance to share heat efficiency figures, calling the IPP arrangements unjust from the outset.
Senator Shibli Faraz lambasted the Power Division for dodging questions.
"Over the past four years, we've received no clear answers. These projects were the result of collusion. Costs were artificially inflated to increase profits, not due to genuine investment. This has crippled our economy and burdened generations," he said. He condemned the ongoing use of bank loans to settle circular debt, saying, "We celebrate borrowing like it's a success story".
Faraz also stressed that the Power Division must stop hiding behind task forces and face parliamentary scrutiny head-on.
Responding to criticism, Power Secretary Rashid Mahmood Langrial explained that circular debt payments were now linked to existing debt-servicing surcharges and assured the committee that no new financial burden would be passed onto consumers. He defended the government's decision to reduce electricity subsidies, saying it helped control the circular debt.
Langrial admitted that certain IPPs had been granted excessive rates of return and said, "We have already recovered an additional Rs30 billion in excess profits from IPPs earned through fuel and O&M margins."
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