Latest news with #SenateStandingCommitteeonPower
Business Recorder
24-05-2025
- Business
- Business Recorder
Less hydel output: Generation mix changes may affect rebased tariff: Nepra
ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Friday said that impact of change in generation mix due to less hydel generation is expected to effect the proposed rebasing tariff for the fiscal year 2025-26. Testifying before Senate Standing Committee on Power, presided over Senator Mohsin Aziz, Nepra Chairman Waseem Mukhtar said since there is substantial decrease in rains in the country, it will alter the projected generation mix for next fiscal year, which implies that whatever relief was expected for next year, will not be available. The standing committee was apprised that current relief of Rs 7.41 per unit is available to consumers from April 2025, of which the impact of revision or termination of agreements is around Rs 1.81 per unit, QTA Rs 2.37 per unit, FCA Rs 1.12 per unit and Rs 2.12 per unit due to raising the Petroleum Levy will continue but relief under QTAs and FTAs is subject to economic conditions of the country and the price of fuel in the international market. Hydel reduction forecast: Nepra seeks generation plan from PD Minister for Power, Awais Leghari informed the committee that he has held a meeting with the Finance Minister on deduction of provinces reconciled amounts. Currently an amount of Rs 161.472 billion is outstanding against provinces but no province is ready for reconciliation except Punjab. Of total receivables of Rs 161.472 billion, share of Punjab is Rs 41.832 billion, Sindh, Rs 67.960 billion, Balochistan, Rs 41.600 billion and KP, Rs 10.080 billion. The minister expressed anger at the absence of senior officials from PPMC and CPPA-G to respond to queries of Standing Committee members as junior officials were unable to provide the explanations requested by the Committee members. On the issue of ToU meters, the minister stated that an exercise has been done in coordination with Aptma, which proves that if the mechanism of ToU meters is done away with it will have additional impact of Rs 35 billion on industry. Copyright Business Recorder, 2025
Express Tribune
24-02-2025
- Business
- Express Tribune
Govt warns IPPs of forensic audit
Refuting rumours of new taxes on solar power, Minister for Power Awais Leghari stated that the government has no such plans in the near future. photo: file The government on Monday warned independent power producers (IPPs), including wind power plants, of a forensic audit if they refuse to renegotiate agreements. After negotiations with IPPs, the government terminated contracts with six private power plants, while others agreed to rupee-based returns and a hybrid take-and-pay basis, Special Assistant to the Prime Minister on Power Muhammad Ali informed a parliamentary panel. The Senate Standing Committee on Power, chaired by Senator Mohsin Aziz, met to review ongoing IPP negotiations, forensic audits, and the privatisation strategy for power distribution companies. Ali stated that the government previously paid between Rs70 billion and Rs80 billion annually to these power plants, with Hubco alone receiving Rs30 billion per year. The scrutiny of IPPs aims to reduce capacity payment burdens and improve sector efficiency. Senator Shibli Faraz questioned whether power producers had been pressured during negotiations. Ali rejected the claim of forced compliance, stating, "We have not pressured or coerced any IPP into agreements. The faults of power producers were evident during negotiations." He added that discussions are ongoing with RLNG-based, gas-based, and government-owned power generation companies, as well as 45 renewable energy plants, including wind and solar, ensuring no adverse impact on their lenders. Efforts are also underway to eliminate the power sector's circular debt by borrowing funds from banks at fixed tenors. Faraz questioned why no forensic audit had been conducted despite the billions paid to IPPs. "IPPs have extracted massive sums through fuel inefficiencies and deceptive efficiency claims," he stated. Ali acknowledged the issue but pointed out that Pakistan lacks the expertise and financial resources needed to audit 50 to 60 power plants. "In 2020, we were not allocated any funds for forensic audits. However, one plant that refused to negotiate is currently undergoing an audit, and any IPP that declines dialogue will face a similar audit," he added. Minister for Power Awais Leghari stated that negotiations with IPPs are expected to save Rs1.4 trillion. "We have conducted discussions with IPPs without discrimination," he emphasised. Secretary of the Power Division, Dr Fakhre Alam Irfan, informed the committee that the government plans to privatise three power distribution companies: Islamabad Electric Supply Company (IESCO), Gujranwala Electric Power Company (GEPCO), and Faisalabad Electric Supply Company (FESCO). Financial advisors have been appointed for the privatisation process. Hyderabad Electric Supply Company (HESCO), Sukkur Electric Power Company (SEPCO), and Peshawar Electric Supply Company (PESCO) will be offered under long-term concession agreements, he added. Leghari noted that since June 2024, electricity tariffs for domestic and industrial consumers have been reduced by Rs4 to Rs11 per unit, with further reductions expected as negotiations conclude. Regarding taxes on electricity bills, the secretary stated that the government is working to reduce them but must first obtain approval from the International Monetary Fund (IMF). "Our discussions with the IMF are scheduled for the first or second week of March," he said. Additionally, the government has allocated Rs55 billion to transition agricultural tube wells in Balochistan to solar power. Senate Committee Chairman Mohsin Aziz praised the task force's efforts in renegotiating IPP contracts but urged that financial relief be passed on to consumers. "People need to know when they will actually benefit from these measures," he emphasised. Adviser Muhammad Ali assured that as negotiations conclude, the benefits will gradually be transferred to consumers. He disclosed that the government has fixed the return for power plants at 17%, down from the previous 35%, and recovered Rs35 billion paid by the federal government for fuel. Talks with 45 renewable energy plants aim to reduce profit margins to sustainable rates. Ali also mentioned plans to establish an entity named ISMO to create competitive markets and ensure the long-term sustainability of the power sector. Additionally, the government is negotiating to eliminate interest on circular debt and structure payments over the next five to seven years. Senator Aziz noted that, despite positive outcomes from IPP negotiations, consumers have yet to see substantial relief. Leghari responded that electricity costs have been reduced by approximately Rs4 per unit for domestic consumers and Rs11.5 to Rs12 per unit for industrial sectors, with further reductions expected. Refuting rumours of new taxes on solar power, Leghari stated that the government has no such plans in the near future. The committee also discussed the implementation of recommendations from the 2018 Senate Special Committee on Circular Debt, chaired by Senator Syed Shibli Faraz.
Express Tribune
24-02-2025
- Business
- Express Tribune
Govt to ensure power supply during Ramadan, including theft-prone areas
Listen to article The federal government has affirmed its readiness to provide uninterrupted power supply to consumers during sehri and iftar hours across all areas in Ramadan, including those with high electricity theft, according to Express News. Energy Minister Owais Leghari said that instructions would be issued immediately to ensure uninterrupted power for fasting households. Leghari also dismissed speculation about imposing a solar tax, stating that there were no past or future plans for such a levy. He suggested that power tariffs could be reduced further in the coming months. During a Senate Standing Committee on Power meeting, government officials provided updates on negotiations with independent power producers (IPPs). Special Assistant to the Prime Minister on Power Muhammad Ali said agreements with six IPPs had already been terminated, and discussions were ongoing to transition others from dollar payments to local currency. He noted that circular debt reduction remained a priority, with plans to waive interest on outstanding dues and seek fixed-cost loans from banks to clear liabilities. The meeting saw a dispute over journalists recording the proceedings. A reporter attempted to film, prompting Leghari to question whether parliamentary rules allowed such recordings. Senator Shibli Faraz remarked that journalists could face action under Pakistan's cyber laws if they misreported the session. However, the committee chairman, Senator Mohsin Aziz, ruled in favour of allowing media coverage, acknowledging that state broadcasters were slow to release footage. The decisions on electricity supply and power sector reforms come as Pakistan grapples with an economic crisis and rising energy costs, making affordability and accessibility key public concerns.
