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IPPs in a fix, generation down by 50 percent

Eight independent power producers (IPPs) with combined generation capacity of 1700MW electricity are producing less than 1000MW, as these have not been so far paid the committed Rs8 billion, said sources at IPPs Advisory Committee.

Power sector experts regret that most efficient IPPs of the country are being deprived of even fuel at a time when the country is facing its worst-ever power crisis.

The power purchaser and the government had submitted before the Supreme Court to pay Rs24 billion in three monthly installments of Rs8 billion each.

A sum of Rs45 billion had been verified as the undisputed over due amount to these IPPs before the Supreme Court.

The Supreme Court had also directed the government not to deduct the capacity payment arising due to the non-payment of overdue amount to the IPPs by the government and National Transmission and Dispatch Company (NTDC).

The SC had directed the government and NTDC on July 13 to reconcile the overdue amount with the IPPs and inform payment deadlines on July 25 before the court.

The IPPs and NTDC after several meetings reconciled the amount from total default of which some payments during this time were made by the NTDC.

The NTDC and IPPs had finalised Rs45 billion to be undisputed overdue outstanding, of which the government offered to pay these IPPs Rs8 billion every month for the next three months above the regular energy and capacity invoices becoming due during this period, the sources said.

The formula for the rest of the overdue amount will be mutually worked out between the government, NTDC and the IPPs.

The IPPs confirmed that nothing of the outstanding dues had been paid to them and the government is only paying them money on a daily basis to purchase fuel for generation.

Officials said that the IPPs are facing severe liquidity crunch and the generation had fallen to just 50 percent of the capacity.

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