ISLAMABAD: A dispute of Rs 172.8 billion between K-Electric and Central Power Purchasing Agency Guaranteed (CPPA-G) is yet to be resolved despite passage of two years’ time, sources told Business Recorder.
In a letter to Power Division, Chief Financial Officer (CFO), K-Electric, Aamir Ghaziani referred to the TDS balance report for July 2025 submitted through a letter on August 08, 2025, for counter signature by MoE.
In response, a revised balance report was shared by CPPA-G on August t8, 2025, which was not in accordance with the clause 2.5 of Tariff Differential Subsidy Agreement (TDSA). Further, as per clause 2.7 of the TDSA, disputed items, if any, are to be addressed separately through the agreed dispute resolution mechanism.
Payment dispute between CPPA-G, KE remains unresolved
Moreover, KE highlighted that as per the TDSA signed between KE and GoP, all releases pertaining to the period post December 31, 2023, are required to be made directly to KE’s Master Collection Account instead of CPPA-G. Hence, the releases of Rs 172.8 billon to CPPA-G are to be adjusted from balances outstanding prior to effective date of TDSA.
In addition, KE highlight that TDSA does not provide for any markup on negative claims as mentioned in revised balance report. Further, it may be noted that post determination by NEPRA, these claims are receivable by KE and KE also retains the right to claim markup for delays in processing of the tariff determinations within the timeframe provided in NEPRA Act, under clause 2.9 of TDSA.
“We reiterate our request for smooth implementation of the signed agreements. This is essential for KE’s liquidity and financial sustainability and equally important for avoiding additional fiscal burden on GoP,” CFO KE added.
The power utility company noted that KE fully honored its obligations under the Power Purchase Agency Agreement (PPAA) making timely payments of Rs 354.4 billion to CPPA-G for power purchases since January 2024. Accordingly, there are no outstanding dues payableto CPPA-G for this period.
Copyright Business Recorder, 2025
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