Amid the rising electricity rates in Pakistan, officials from Asia Pak Investments have proposed ending dollar-based returns on investment for Independent Power Producers (IPPs), suggesting a switch to Pakistani rupees. This move aims to lower power tariffs and offer relief to consumers.
Asia Pak Investment Chairman, Shehryar Chishti, emphasized that IPPs are aware of Pakistan's worsening electricity crisis and stressed the importance of finding solutions to provide affordable electricity to the public. He pointed out that while Liberty shared its profits in 2021, the energy sector has faced significant challenges since then.
Chishti also offered recommendations to the federal government on reducing electricity costs. He proposed convening an emergency meeting of all IPPs to develop a strategy to cut electricity prices, underscoring the urgency of providing relief to the public.
The proposal comes as the government has announced plans to shift the financial burden of payments to IPPs onto citizens, already grappling with rising inflation. During a meeting of the National Assembly's Standing Committee on Energy, Secretary of Energy Fakhre Alam Irfan highlighted that both payments to IPPs and interest on revolving loans would be passed on to the public. He also noted the government's pressure from the International Monetary Fund (IMF), which remains firm in its stance against increasing the country’s circular debt.
Earlier, on August 20, Federal Minister Awais Leghari mentioned that Prime Minister Shehbaz Sharif would share positive news regarding IPPs within a month or two. Speaking at a youth convention in Islamabad, the energy minister acknowledged the pressing energy crisis and stressed that reforms in the energy sector were unavoidable. He highlighted the country's energy billing, which has reached PKR 1,100 billion, with PKR 400 billion in losses.
Leghari added that while the government had been quietly working on the IPP issue, increased public pressure had helped drive attention to the matter.