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IPPs facing discrimination by NTDC

The eight independent power producers (IPPs) who moved the Supreme Court against nonpayment of their dues by the National Transmission and Dispatch Company (NTDC) are grossly being discriminated as their capacity invoices are pending since April 2012, sources in IPP Advisory Committee said.

These IPPs are unable to pay their quarterly installments of project loans, hence, are defaulting in repayment.

A total of Rs160 billion are outstanding towards the IPPs under the project loans and as running finance facilities. The working capital cost and part of capacity invoice is also pending since April 2012, sources said.

“The power plants under the 2002 Power Policy have to pay Rs700 million to Rs800 million as quarterly installments against their project loans they had taken from banks to establish plants but due to the failure of NTDC in payment of capacity invoices, the IPPs are not able to pay the quarterly installments,” a senior official of an IPP said.

Adding to their woes is the upfront deducted capacity entitlement by NTDC for such hours when the IPPs are actually and technically available but cannot generate electricity due to their inability to purchase the requisite fuel because of nonpayment from the power purchaser.

This persistent payment default of the power purchaser, which is further aggravated by the default of the government under its sovereign guarantee, is taking a heavy toll on the IPPs.

Installments of long-term loans are pending and all IPPs have defaulted on March installment, the official said.

“The IPPs would be categorised as defaulters if they fail to pay the next installments, therefore, it is essential that outstanding capacity invoices should be paid immediately by the end of this month enabling the IPPs to operate,” he said.

These IPPs include Nishat Chunian Power, Nishat Power, Liberty Power Tech, Atlas Power, Saif Power and Orient Power.

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