Pakistan tells IPPs to run at 100% capacity

The government of Pakistan has shipped furnace oil for one week to seven independent power producers and asked them to start running plants at 100% capacity.

Pakistan State Oil, on the insistence of the government, has provided around 60,000 tons of furnace oil to seven IPPs to help them produce sufficient electricity to provide immediate relief to the power crisis.

The IPPs which received the furnace oil included Japan Power with 100-megawatt capacity, Atlas Power with214MW, Sapcol with 130MW, AES Lalpir with 325MW, Lalpir Pak Gen with 325MW, Kel Power with 127MW and Saba Power with 130MW.

Before the dispatch of fresh oil consignments, these power plants were operating at 30% to 40% of their installed capacity. According to sources, the managements of the IPPs, which adjusted their shifts according to the low capacity utilisation, are wondering how they will be able to arrange manpower on an immediate basis.

“This will create another stream of circular debt for the IPPs as the government is already defaulting on payments and consequently IPPs are not able to repay bank loans. This ‘forced’ power generation will put IPPs in further financial stress if the National Transmission and Dispatch Company is unable to pay the credit inseven days,” said an IPP representative.

Commenting on the developments, NTDC Director General Ejaz Rafique Quraishi said it was IPPs’ job to produce electricity and no discussion or consultation was required.

“They will have to operate now at 100% capacity, this is not our issue from where they arrange the manpower,this is their concern,” he said. “There will be zero tolerance.”

Quraishi also rejected the IPPs’ claim that payments had not been released. “The government is regularly payingthe IPPs and the perception that we are not paying the dues is absolutely wrong.”

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