The federal cabinet on Tuesday approved settlement agreements with eight independent power producers (IPPs) running on bagasse, as part of ongoing efforts to reduce electricity tariffs and save around Rs. 240 billion for the national exchequer.
Prime Minister Shehbaz Sharif chaired the federal cabinet meeting that approved the agreements on recommendations of the Ministry of Energy’s power division. According to a statement issued by the Prime Minister’s Office, the IPPs—DW Unit-I; Unit-II; RYK Mills; Chiniot Power; Hamza Sugar; Al-Moez Industries; Thal Industries; Chinar Industries—have agreed to revise their production costs.
The matter would now proceed to the Central Power Purchasing Agency, which would seek approval from the National Electric Power Regulatory Authority (NEPRA) for tariff adjustments.
According to the statement, the revised agreement would reduce electricity prices for consumers and save Rs. 238 billion of the exchequer.
This is the second round of ‘revised’ IPP agreements. In October, the government terminated power purchase agreements with five IPPs, which collectively produced 2,463MW of electricity. Those IPPs were all nearing the end of their contracts and the premature termination of their agreements are estimated to save Rs. 411 billion for the exchequer.
Addressing the cabinet, the prime minister said the government was taking all possible steps to reduce electricity prices for citizens. He emphasized national interests should always be prioritized, adding promoting the private sector and industries in the country was one of the government’s priorities.
The cabinet meeting was also brief on the latest situation in Syria and the ongoing evacuation of Pakistanis from the Middle Eastern state. It was told that 79 of 250 Pakistani pilgrims in Syria had already reached Beirut and would soon begin their journey back to Pakistan. It was also told that officials of Pakistani embassies in Syria and Lebanon were taking all possible measures to ensure the safe return of Pakistanis from Syria.
The cabinet, acting on the recommendation of the Ministry of Defense Production, approved the appointment of Brig. Asim Bashir Warraich as a member of production control on the board of Heavy Industries Taxila. It also approved the establishment of a National Commission for the Status of Women Fund on the recommendation of the Ministry of Human Rights.