SC and SIFC forums: FPCCI will fight case against IPPs’ capacity charges: Mohamin

KARACHI: Abdul Mohamin Khan, Acting President of FPCCI, has said, on behalf of the entire business, industry and trade community of Pakistan, FPCCI will plead the case of unbearable capacity charges of IPPs to the apex forums of the Supreme Court of Pakistan and Special Investment Facilitation Council (SIFC) – as the last resort to save the economy and the people of Pakistan.

Abdul Mohamin Khan, Acting President FPCCI, highlighted that despite the repeated and unrelenting expression of its concerns and apprehensions – loud and clear – pertaining to IPPs capacity charges, the business community is still not being taken on board for the consultative process to resolve the issue at the earliest; despite being the primary stakeholder of the issue.

Acting FPCCI Chief presented the charter of demands vis-à-vis power sector: (i) forensic audit of independent power producers (IPPs) should be ordered (ii) capacity charges of IPPs should be abolished and only generated electricity should be paid (iii) power purchase agreements with IPPs should be renegotiated in a fair and transparent manner.

Abdul Mohamin Khan, Acting President FPCCI, maintained that the country has paid the capacity charges of approximately PKR. 2,000 billion in the FY24; and, the same will further steeply rise to PKR. 2,700 – 2,800 billion in the FY25.

Abdul Mohamin Khan elaborated that guarantees to IPPs indexed to the US dollar mean any depreciation of the Pakistani rupee increases returns for IPPs – adding debilitating financial burden on the government and the public alike.

The FPCCI demands that a comprehensive review of IPP agreements; price re-evaluation within legal bounds and improved oversight to prevent over-invoicing are utmost needed. Examining the energy infrastructure for clauses related to misinformation and fraud is also required.

The federal government must devise a strategy to deal with IPPs and ensure affordable electricity prices for the industry in the national interest, Abdul Mohamin Khan proposed.

Copyright Business Recorder, 2024