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Business Recorder
a day ago
- Business
- Business Recorder
Pakistan govt to recover Rs1.938trn from power consumers in 6 years
ISLAMABAD: The federal government is to recover $ 6.7 billion (Rs 1.938 trillion) in six years from power consumers across the country through Debt Service Surcharge (DSS) of Rs 3.23 per unit, which is being uncapped to meet any variation in recovery to meet the target, well informed sources in Power Division told Business Recorder. Central Power Purchasing Agency-Guaranteed (CPPA-G) and the scheduled banks alongwith allocated amounts will sign the pacts once clarity on worth of assets of few Discos is received by the Power Division. 'There is ambiguity on the total amount to be raised. It will be either 1.21 trillion, Rs 1.25 trillion or Rs 1.275 trillion,' the sources added. Nepra's decisions on KE tariffs: Power Div. flags potential consumers harm, urges revision The names of banks, which have entered into the agreement with the CPPA-G as Agent of power Distribution Companies are as follows: (i)Meezan Bank Limited ;(ii) Habib Bank Limited ;(iii) National Bank of Pakistan;(iv) Allied Bank Limited;(v) United Bank Limited ;(vi) Faysal Bank Limited ;(vii) Bank Al Habib Limited;(viii) MCB Bank Limited ;(ix) Bank Alfalah Limited;(x) Dubai Islamic Bank Limited;(xi) The Bank of Punjab ;(xii) Bank Islami Pakistan Limited;(xiii) Askari Bank Limited ;(xiv) Habib Metropolitan Bank Limited ;(xv) Al Baraka Bank Limited ;(xvi) Bank of Khyber ;(xvii) MCB Islamic and ;(xviii) Soneri Bank Limited. Last week, the federal cabinet approved the following proposals of Power Division with minor amendments in a couple of proposed clauses: (i) CPPA-G has been directed (as agent on behalf of DISCOs) to perform public service obligations and undertake related activities in relation to circular debt stock financing and settlement in terms of Section 7(4) read with Schedule II of the SOE Act as per the proposed terms reflected in the indicative term sheet (Annex-VII) to be executed by CPPA-G for and on behalf of DISCOs and execute 'CD Restructuring, Settlement and Subscription Agreement (CDRSSA)' between the Government of Pakistan, DISCOs and CPPA-G;(ii) Authorized the Ministry of Energy (Power Division) to execute relevant documents as may be required on behalf of the Government of Pakistan per the terms and conditions reflected in the indicative term sheet and to execute the Agreement;(iii) authorized the Ministry of Energy (Power Division) to direct DISCOs to execute relevant instruments and create such security as may be required for the purposes of the financing reflected in the indicative term sheet;(iv) approve the draft amendment in Section 31(8) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 and the draft legislation be made part of the Finance Bill 2025-26;(v) approved immediate release to CPPA-G and utilization of Rs. 267 billion, already budgeted and available in power division demand no 33 under the head of GoP investment in DISCOs equity. Rs. 267 billion would be reduced to the extent of the K-Electric TDS utilization; (vi) approve technical supplementary grant of Rs. 393 billion from finance division demand no. 45 to power division demand no. 33 to be immediately released to CPPA-G under the head of GoP investment in DISCOs equity; (vii) authorized CPPA-G to utilize amounts to pay off the negotiated payables of Government-owned Power Plants (GPPs). Excess amount, if any, after payment of GPPs shall be utilized for payment to Uch-I & Uch-II for onward payment to OGDCL; (viii) authorized CPPA-G to utilize part of the proceeds raised under the aforementioned term sheet to settle and retire the outstanding debt obligations of Rs. 683.253 billion of PHL; (ix) authorized CPPA-G to disburse payments to the respective IPPs from the bank financing subject to waive Late Payment Interest (LPI) by the IPPs; (x) approve the draft amendments in Section 3(3) of the Sales Tax Act, 1990 and Section 113(3)(a) of the Income Tax Ordinance, 2001 and the draft legislation be made part of the Finance Bill 2025-26; (xi) the Term Sheet being negotiated is substantially lower than the banking sector benchmark/interbank profit rates, and to approve the exemption from the bidding under PPRA Rules; and (xii) approve the amendment in Rule-5 of the 'Pakistan Energy Sukuk Rules, 2019' as follows '5-Redemption. - The Sukuk shall be redeemable before maturity'. On June 18, 2025, the cabinet further directed that the amendments proposed in the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 in the summary shall be further amended as presented during the Cabinet meeting, and will be made part of the Finance Bill, 2025 after legal vetting by the Law and Justice Division. The amendments proposed in the statutes will be made part of the Finance Bill, 2025 after legal vetting by the Law and Justice Division and amendments proposed in the rules about term sheets will be vetted from the legal point of view by the Law and Justice Division. Copyright Business Recorder, 2025
Business Recorder
a day ago
- Business
- Business Recorder
Govt to recover Rs1.938trn from power consumers in 6 years
ISLAMABAD: The federal government is to recover $ 6.7 billion (Rs 1.938 trillion) in six years from power consumers across the country through Debt Service Surcharge (DSS) of Rs 3.23 per unit, which is being uncapped to meet any variation in recovery to meet the target, well informed sources in Power Division told Business Recorder. Central Power Purchasing Agency-Guaranteed (CPPA-G) and the scheduled banks alongwith allocated amounts will sign the pacts once clarity on worth of assets of few Discos is received by the Power Division. 'There is ambiguity on the total amount to be raised. It will be either 1.21 trillion, Rs 1.25 trillion or Rs 1.275 trillion,' the sources added. Nepra's decisions on KE tariffs: Power Div. flags potential consumers harm, urges revision The names of banks, which have entered into the agreement with the CPPA-G as Agent of power Distribution Companies are as follows: (i)Meezan Bank Limited ;(ii) Habib Bank Limited ;(iii) National Bank of Pakistan;(iv) Allied Bank Limited;(v) United Bank Limited ;(vi) Faysal Bank Limited ;(vii) Bank Al Habib Limited;(viii) MCB Bank Limited ;(ix) Bank Alfalah Limited;(x) Dubai Islamic Bank Limited;(xi) The Bank of Punjab ;(xii) Bank Islami Pakistan Limited;(xiii) Askari Bank Limited ;(xiv) Habib Metropolitan Bank Limited ;(xv) Al Baraka Bank Limited ;(xvi) Bank of Khyber ;(xvii) MCB Islamic and ;(xviii) Soneri Bank Limited. Last week, the federal cabinet approved the following proposals of Power Division with minor amendments in a couple of proposed clauses: (i) CPPA-G has been directed (as agent on behalf of DISCOs) to perform public service obligations and undertake related activities in relation to circular debt stock financing and settlement in terms of Section 7(4) read with Schedule II of the SOE Act as per the proposed terms reflected in the indicative term sheet (Annex-VII) to be executed by CPPA-G for and on behalf of DISCOs and execute 'CD Restructuring, Settlement and Subscription Agreement (CDRSSA)' between the Government of Pakistan, DISCOs and CPPA-G;(ii) Authorized the Ministry of Energy (Power Division) to execute relevant documents as may be required on behalf of the Government of Pakistan per the terms and conditions reflected in the indicative term sheet and to execute the Agreement;(iii) authorized the Ministry of Energy (Power Division) to direct DISCOs to execute relevant instruments and create such security as may be required for the purposes of the financing reflected in the indicative term sheet;(iv) approve the draft amendment in Section 31(8) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 and the draft legislation be made part of the Finance Bill 2025-26;(v) approved immediate release to CPPA-G and utilization of Rs. 267 billion, already budgeted and available in power division demand no 33 under the head of GoP investment in DISCOs equity. Rs. 267 billion would be reduced to the extent of the K-Electric TDS utilization; (vi) approve technical supplementary grant of Rs. 393 billion from finance division demand no. 45 to power division demand no. 33 to be immediately released to CPPA-G under the head of GoP investment in DISCOs equity; (vii) authorized CPPA-G to utilize amounts to pay off the negotiated payables of Government-owned Power Plants (GPPs). Excess amount, if any, after payment of GPPs shall be utilized for payment to Uch-I & Uch-II for onward payment to OGDCL; (viii) authorized CPPA-G to utilize part of the proceeds raised under the aforementioned term sheet to settle and retire the outstanding debt obligations of Rs. 683.253 billion of PHL; (ix) authorized CPPA-G to disburse payments to the respective IPPs from the bank financing subject to waive Late Payment Interest (LPI) by the IPPs; (x) approve the draft amendments in Section 3(3) of the Sales Tax Act, 1990 and Section 113(3)(a) of the Income Tax Ordinance, 2001 and the draft legislation be made part of the Finance Bill 2025-26; (xi) the Term Sheet being negotiated is substantially lower than the banking sector benchmark/interbank profit rates, and to approve the exemption from the bidding under PPRA Rules; and (xii) approve the amendment in Rule-5 of the 'Pakistan Energy Sukuk Rules, 2019' as follows '5-Redemption. - The Sukuk shall be redeemable before maturity'. On June 18, 2025, the cabinet further directed that the amendments proposed in the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 in the summary shall be further amended as presented during the Cabinet meeting, and will be made part of the Finance Bill, 2025 after legal vetting by the Law and Justice Division. The amendments proposed in the statutes will be made part of the Finance Bill, 2025 after legal vetting by the Law and Justice Division and amendments proposed in the rules about term sheets will be vetted from the legal point of view by the Law and Justice Division. Copyright Business Recorder, 2025
