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Government may ask SC’s permission to treat three RPPs as IPPs

The government is considering moving the Supreme Court to grant permission to make Rental Power Plants (RPPs) functional as Independent Power Plants (IPPs) to overcome the escalating power crisis, said top functionaries at the Ministry of Water and Power.

The Supreme Court (SC) on March 29, 2012 termed the agreements of RPPs unlawful and held the Ministry of Finance, Wapda, Pepco and Gencos responsible for inflicting huge losses on the national exchequer. The apex court had mentioned in the verdict that large-scale embezzlement was found in the affairs of Sharaqpur Power Plant, Reshma Rental Generation Company Limited, Karkey Rental Power Plant and Gulf Rental Power Project.

The court had directed the National Accountability Bureau (NAB) to proceed against the above mentioned and submit a fortnightly report. Now, with the power crisis having escalated, government officials said, the Ministry of Water and Power is working on the proposal seeking permission from the Supreme Court to make three RPPs functional as IPPs.

“And in case the SC grants permission, the government would ink agreement with the three RPPs as IPPs as the said three RPPs have expressed their willingness to generate electricity as IPPs,” they said.

The efficiency of the RPPs that include Gulf, Noudero-I and Karkey RPPs is better than that of the IPPs, officials claimed, and added that NAB has cleared the Gulf Rental Power Plant hoping that the other two companies would soon be getting the clearance certificate. The said plants would consume less fuel as compared to existing IPPs, they said.

The Private Power Infrastructure Board (PPIB) would arrive at an agreement with the three RPPs as IPPs and the National Electric Power Authority (Nepra) would determine their tariffs as IPPs, said government officials. Under the new agreement, the government would have 329 MW electricity that includes the 62 MW of Gulf Rental Power Plant, 222 MW of Karkey and 45 MW of Noudero-I.

Reshma Rental Power Company had installed the power house of 80 MW against the agreement of establishing the 210 MW plant and NAB to this effect is also probing why this happened, said official sources. If NAB gives the clean chit to Reshma Rental Power Company, the government would also make agreement with it as an IPP. “However, the issue of Reshma Rental Power Company is more complex than the other three rental power companies.”

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