SC summons power minister over excessive payments to IPPs

ISLAMABAD: Taking strong exception to excessive payments made to independent power producers (IPPs), the Supreme Court on Wednesday summoned Federal Minister for Power Omar Ayub Khan to explain his position.

A three-judge bench headed by Chief Justice of Pakistan Mian Saqib Nisar was hearing a suo motu case pertaining to excessive amount paid to IPPs by the government.

At the outset of the hearing, Justice Ijazul Ahsan, a member of the bench, quoted a report as saying that IPPs were paid Rs159 million each and questioned if the power producers were paid as per their power generation capacity.

The secretary power division, who was present in the court, explained that the IPPs were paid as per their capacity and fuel consumption. “They are paid as per their capacity despite the fact that they generate electricity or not.”

“Millions of rupees were paid to IPPs even if they produced electricity or not,” Justice Nisar lamented. “Such agreements are being revoked the world over.”

“People didn’t get electricity but private companies were made full payments. Nothing was obtained by paying billions of rupees to private companies,” he continued.

“The agreement with private power companies has turned out to be a noose.”

On Jan 5, the chief justice took notice of excessive payments made to independent power producers (IPPs). He observed that the court had been told that excessive payments were made to IPPs in connection with circular debt and apparently it was a matter of $ 1.5 billion.

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