Termination of IPPs contracts: President HCSTSI lauds govt

HYDERABAD: Muhammad Saleem Memon, President, Hyderabad Chamber of Small Traders & Small Industry (HCSTSI), expressed his gratitude to the Government of Pakistan, the Ministry of Energy, and all relevant stakeholders, appreciating recent initiatives, especially the cancellation of several Independent Power Producers (IPPs) agreements.

He stated that the termination of contracts with companies like Atlas Power, Liberty Power, and Falcon Power is a significant step towards transparency and improvement in the energy sector, benefiting both the public and industrial sectors.

President Chamber Saleem Memon further emphasized that since November 2022, the HCSTSI has consistently raised its voice against the lack of transparency and the unjustified increase in electricity prices under these IPPs agreements. These contracts had driven electricity prices to unbearable levels, adversely impacting the national economy and industries.

He highlighted the Chamber’s longstanding demand for the government to reassess these agreements and to terminate those contrary to public interest. Acknowledging the 411 billion rupee savings achieved through these measures as a positive development, he stressed that this process must not stop here. A thorough audit of all remaining power producers’ contracts is essential to identify and cancel any agreements that do not serve the national interest.

President HCSTSI drew the government’s attention to the considerable decline in electricity demand from industries, observing that the load per megawatt has decreased significantly this September and October compared to last year, signalling industrial decline. He warned that without timely decisions, electricity demand will continue to fall, increasing capacity charges and additional surcharges, which could lead to irreparable economic damage.

Endorsing the FPCCI’s recommendation, he urged the government to promptly announce a winter package considering the upcoming season, providing facilities for industries without any misleading statistics. He stated that if the actual electricity cost is calculated transparently, it stands around Rs9 per unit. However, increasing capacity charges and unnecessary surcharges are burdening the industry, which demands immediate government intervention and action.

President Saleem Memon appealed to the government to provide affordable and reliable electricity to industries to enable Pakistan to become self-reliant and economically strong. Such measures will not only increase manufacturing but also enhance exports, boosting foreign exchange reserves. As a result, industries will be able to contribute higher tax revenues to the government, playing a vital role in national development and public welfare. Additionally, he emphasized that by providing industries with a supportive environment and necessary facilities, Pakistan can improve its competitiveness in the global market, benefiting the economy and creating job opportunities across the country.

Copyright Business Recorder, 2024