ISLAMABAD - The Supreme Court on Monday issued notices to the secretaries ministry of finance and water and power over non-payment of Rs 8 billion to the independent power producers (IPPs), as per schedule.

A two-member bench comprising Justice Nasirul Mulk and Justice Ijaz Ahmed Chaudhry heard the petition, moved by eight IPPs against the government, praying that the government had failed to pay them dues worth Rs61.401 billion during the last couple of months, which has worsened the power crisis in the country.

The federal government, through the ministries of water and power and finance, National Transmission and Dispatch Company (NTDC), Private Power and Infrastructure Board (PPIB), National Electric Power Regulatory Authority (Nepra), Water and Power Development Authority (Wapda), Pakistan Electric Power Company (Pepco), Central Power Purchasing Agency (CPPA), the State Bank of Pakistan (SBP) and independent power producers advisory council, are respondents in the case.

The bench noted that in the last hearing former and the incumbent secretaries of ministry of finance and water and power had been directed to appear before the court and explain why the payment could not be made to the IPPs.

Khawaja Tariq Rahim told the court, in the last hearing, that the government had decided to pay Rs 45 billion to the power producers. He further said Rs 8 billion had been paid in July, while Rs 8 billion would be paid by 30th August and another Rs 8 billion on 30th September. Khalid Anwar, counsel for the IPPs, appearing before the bench informed the court that the government had to pay the second instalment of Rs 8 billion to be power companies on August 30, which had not been paid yet. He further said that due to non-payment the companies were presently producing 50 per cent, adding if the payments were made they could produce 100 per cent electricity.

An official of the finance ministry said due to financial crisis Rs 8 billion could not be paid on August 30. However, he said, the payment would be made in 2 to 3 weeks. 

Khalid said if the government would not pay funds to the power producers there would be more loadshedding daily in the country, adding due to non-payment the circular debt was also rising.

The court observed that due to loadshedding in the country the exports had been affected.

IPPs counsel said the looming energy crisis was bound to have a devastating impact on the economy already reeling from a series of blows due to reckless governmental actions, some planned and some consequential.

The counsel for the ministry of water and power said the payment would be made to IPPs by September 8.

He said it was responsibility of the government to provide electricity to the consumers. The hearing was adjourned till September 12.