The Independent Power Producers Advisory Council (IPPAC) has urged the Prime Minister to resolve financial crisis the independent power producers (IPPs) are facing on account of large overdue receivables from NTDC/CPPA. "This is in continuation to our previous letter dated November 15 and as highlighted in the previous letter, the overdue amounts payable to the 20 members of the IPPAC is still outstanding and growing every month," said the IPPAC in a communiqué.
"Since our last correspondence, the overdue amounts have risen from Rs 195 billion (as of October 31, 2017) to Rs 205 billion (as of November 30, 2017)," stated the letter, adding that for the last several months, IPPs have been requesting the Ministry of Energy on various forums for amicable resolution of overdue balance.
However, the letter added, Ministry of Energy has not been able to resolve these issues. "We would like to again emphasize that many of the IPPs are now so cash-strapped that they cannot timely service their respective financial obligations to their lenders, operators, fuel suppliers and other third parties," stressed IPPAC.
"The GST rate anomaly (20pc on furnace oil versus 17pc on electricity) is unresolved for over 3 years now and despite repeated follow ups, no attention has been paid to this issue either," it stated.
Lastly, the IPPAC mentioned, the final award of Rs 14 billion in International Arbitration for amount unduly withheld by NTDC in 2011-2013, issued in favor of IPPs (revalidating local arbitration award of 2015) has been challenged by NTDC in London Commercial Court. Interest on this amount is accruing at Rs 120 million a month until paid by NTDC/GOP. "This matter has been pending for over six years now, and needs to be closed to avoid tarnishing of the image of government in honouring its contractual commitments," stated the letter.
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