LAHORE - Almost all the 16 Independent Power Producers (IPPs) have refused to comply with the government directives issued time and again for maintaining 21 days furnace oil stock by saying they could not maintain the required furnace oil stock owing to outstanding payments from WAPDA, the sources told The Nation here Friday. They said that the IPPs had not been paying any heed to the government warnings and kept on running their units with the furnace oil stocks only for a couple of days' consumption resulted in the delay of payments. Sources quoting the IPPs response to the government said that these companies were currently were relying mainly on short-term borrowings to plug their working capital gap whereas WAPDA presently owed Rs28 billion. Sources said that IPPs responded to the government citing furnace oil import, which had been increased by massive 68 percent amid high demand from thermal power plants including IPPs. They said that given the growing appetite for power in the country, reliance on thermal power generation had been on the rise for the last two years with its greater usage in thermal power generation. They believe that the demand for furnance oil owing to restrictive gas supplies is likely to rebound till september for thermal power plants followed by spike IPPs for electricity generation during summer, which reached 9.1 million ton by the end of June 2008. However, sources said that the recent hike in gas tariff would be of no impact on the bottom-line of IPPs, as fuel cost of IPPs is a pass through item under predetermined Power Purchase Agreements (PPA). The govt has served notices on independent power producers (IPPs) for not maintaining required furnace oil stocks to ensure uninterrupted power generation in crisis-like situation, however, the lack of follow up on part of the government inducing the IPPs to keep on running their units on almost daily basis. Sources said the government had served number of notices on IPPs and after December 31 seeking explanation for failing to honour contractual obligation of maintaining furnace oil stocks inventory for their requirement for power generation. IPPs as per contract are required to maintain furnace oil inventory for minimum 21 days. A senior official said the government had taken serious notice of IPPs for failing in honouring their furnace oil stocks commitment and asked them for submitting a written explanation. Some of them shifted responsibility to the government as the authorities had rejected their claims and they had been asked to first maintain the required level of 21 days stocks. The official said some IPPs have furnace oil stocks only for two to three-day consumption. The officials have the impression that IPPs are living on very small furnace oil stocks for investing less money for furnace oil procurement. On its part the government has made alternative arrangements for keeping power generation from thermal source intact. Dual-fired IPPs have been provided gas, despite more use by domestic sector, to help them produce power. Others have been asked to shift to diesel use. The alternative arrangements are being made to keep power generation at reasonable level to avoid load shedding during peak hours.