Power plants, Discos: PD opposes 'immediate' sell-off

Giving the background, sources said, Power Division while responding to Establishment Division MS Wing's OM of November 26, 2019 on re-organizing the federal government-proposals regarding privatization candidates/transfer to Sarmaya Pakistan, has stated it has no objection to privatisation of NPPMCL and its power plants i.e.1233MW, Balloki Power Plant, 1230MW Haveli Bahadar Shah Power Plant; however it stated that Central Power Generation Company Genco-II, Nandipur Generation Company(Genco-III) and privatisation of Power Generation Company (Genco-1) cannot be supported while Lakhra Power Generation Company is a new power plant being developed under Asian Development Bank(ADB) finance and is based on coal so the privatisation of this asset cannot be initiated at present.

Power Holding Private Limited (PHPL) is a company of power sector which is specifically structured as a Special Purpose Vehicle (SVP) for holding commercial borrowing of power sector to handle the circular debt . As such it cannot be considered as an entity and cannot be shortlisted for privatisation purpose.

Iesco, Lesco, Gepco, Fesco, Hesco, Mepco, Sepco, Qesco, Pesco and Tesco are distribution companies for which re-structuring and re-organisation is required, before considering these for privatisation. Lakhra Coal Development Company Ltd. Karachi and Government Holding Private Limited and Kaco are not part of Power Division.

Power Division has asked Establishment Division to take further necessary action in light of its proposals.

Establishment Division argued that the federal government notified the formation of a task force in September 2018 to come up with the recommendations for restructuring and re-organizing of the federal government entities after surveys, assessment and discussions by the Task Force, a draft working paper with the proposals suggesting future configuration, regrouping and mapping of each Organizational Equity (QE) was circulated and subsequently discussed by the Secretaries Committee.

The suggestions of the Secretaries Committee were incorporated and the revised proposals pertaining to the OEs under the administrative control of each Ministry were sent to the Ministers In charge for their views.

After these consultations, deliberations and incorporation of the views an updated report along with the draft summary was submitted to the federal cabinet for discussion and decision. The Cabinet in its meeting held on July 9, 2019 approved in principle these recommendations. The Cabinet during the meeting also constituted an Implementation Committee to work out an implementation strategy/work plan.

Copyright Business Recorder, 2019

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