Govt to pay Rs 72bn to five IPPs in final settlement

ISLAMABAD: The federal government decided to pay a total of Rs 72 billion as a final settlement to five Independent Power Producers (IPPs) as it terminated the agreements with them, ARY News reported citing sources.

Prime Minister (PM) Shehbaz Sharif announced to terminate the agreements with five IPPS in the first phase on October 10. According to sources, the government will pay Hubco Rs 36.5 billion and Rs 15.5 billion to the Rousch Power.

Similarly, the Lalpir Power will be paid Rs 12.8 billion, Atlas Power Rs 15.5 billion and, Sapphire Power will be paid Rs 6 billion by the federal government.

According to the sources, the settlement does not include late payment charges. The agreements with the five IPPs will be deemed officially terminated with effect from October 1.

Earlier chairing the federal cabinet meeting in Islamabad, PM Shehbaz said the termination was done after the mutual consent of the owners of the IPPs.

The Prime Minister informed the Cabinet that only the outstanding amounts owed to these IPPs will be paid, without any interest.

He said that termination of these contracts will save power consumers about sixty billion rupees and provide a benefit of around four hundred and eleven billion rupees to the national exchequer.

PM Shehbaz Sharif said it was the outcome of the strenuous collective efforts of the entire government team. He also recognized the inputs and support of the allied parties in this regard. He especially mentioned that Chief of Army Staff General Asim Munir, who took personal interest in the whole matter.

The Prime Minister described the development as a beginning of a journey which he said will be converted into progress and prosperity of the people.

PM Shehbaz Sharif also mentioned the relief provided by both the Federal and Punjab governments to the power consumers during the months of summer.