Awais Leghari Assures Transparency in IPP Talks
Federal Minister for Energy Sardar Owais Ahmed Khan Leghari has stressed the importance of rationalizing electricity tariffs for the country’s economic development and said that negotiations with IPPs are free, fair and transparent,
They have the option of not negotiating, mediation, and a forensic audit. According to a spokesperson for the Power Division, these views were expressed by the Federal Minister for Energy during a meeting held with the International Development Partners for Power Sector on Power Sector Reforms and its way forward.
The development partners in the meeting were led by Mr. Naji Benhassin, Country Director, World Bank, and the delegation included representatives from IMF, ADB, IFC, KFW, German Embassy, ​​FCOD, UNDP and AIIB.
The Federal Minister briefed the participants about the reforms that the Power Division has initiated with the aim of bringing efficiency and discipline to bring electricity prices to a more competitive level for all consumers and especially the industry.
Stressing the importance of efforts to rationalize electricity tariffs for the country’s economy, the Federal Minister assured the participants that all negotiations with IPPs are being conducted in a free and transparent manner, including the right to withdraw from these negotiations or resort to arbitration or opt for forensic audit as per the terms of their agreement.
He said that the government is taking all steps to involve all its development partners and has adopted a holistic approach in the policy formulation and implementation process in this regard.
He said that due to maintaining transparency, the government has been able to cut about 7000 MW from IGCEP, which is a total of 17000 MW, thus saving a huge amount of money in expensive power.
Owais Laghari informed the participants about various reforms undertaken by the Power Division including transition from Take or Pay to Take and Pay, elimination of furnace oil based plants, conversion of imported coal to local coal.
He said that a comprehensive and detailed study of power generation is being conducted, which shows that we did not adopt a low-cost policy in the past, but now it will be the lowest cost.
He also informed about the removal of transmission bottlenecks through construction of Matiari Moro RYK lines, Ghazi Barutha FSD lines, reactive power compensation devices, battery storage system.
He further informed about the division of NTDC into Energy Infrastructure and Development Company and National Grid Company, provision of power to SEZs by preparing regulatory and contractual framework, SLAs with captive generation industries, installation of AMI and APMS Asset Protection Management System on 100% feeders.
Regarding the abolition of circular debt, the minister said that the government wants to give a clear roadmap to abolish it in the next five to eight years. Abolition of electricity duty, rationalization of subsidy is another step towards rationalizing electricity rates.
He said that they are also going to rationalize net metering, due to which the remaining consumers are facing a burden of Rs 150 billion.
He told the participants that increasing the growing demand through reasonable prices, the need for long-term packages for long-term planning is the need of the hour because the use of excess electricity is not increasing any capacity charges.
He also informed the participants about the wholesale electricity market and said that we have decided that the government will not buy more electricity.
The minister also informed the participants about the privatization of discus, improving the governance of discus boards and reforms in the Power Planning and Management Company.
The participants appreciated the reforms initiated by the Power Division and assured their support in this process.
