ISLAMABAD - The federal government is all set to terminate agreements with six more Independent Power Producers (IPPs), with cumulative capacity of 2396 MW, and having a generation cost of up to 63 per unit.
The termination of contracts with six IPPs will save approximately Rs 300 billion, official source told The Nation. These fuel-based 2396 MW IPPs receives over Rs 60 billion annually on account of Energy Purchase Price and Capacity Payments, the source said.
It has been decided to terminate contract with more than three decades old IPP of Kot Addu Power Plant having a capacity of 1638 MW. KAPCO was built by the Pakistan Water and Power Development Authority (WAPDA) in five phases between 1985 and 1996, which was later privatised. The total annual capacity payment to the IPP is Rs 22.170 billion.
Similarly, termination of agreement with furnace oil based Kohinoor Energy Limited (KEL), having a gross capacity of 131.44 MW, is also under consideration. The plant was established 30 years ago in early 1990s. The total annual payment to the KEL is Rs 9.911 billion, including Rs 7.483 billion EPP and Rs 2.427 billion capacity payments. The cost of Kohinoor Energy is Rs 47.72 per unit, which includes Rs 36.03 per unit of Energy Purchase Price (EPP) and Rs 11.69 per unit Capacity Payment.
The government is also considering the termination of contract with RFO based 200 MW Liberty Power Tech Limited. The plant total generation cost is Rs 62.68/unit, which includes Rs 44.03 of energy cost, and Rs 18.65 per unit capacity payment. The plant receives total of Rs 15.032 billion in annual payments, including Rs 10.568 billion EPP and Rs 4.473 billion Capacity Payments.
It has been decided to terminate the contract with 136 MW of Gul Ahmed Energy.Gul Ahmed Energy Limited is a thermal power plant, established in 1994.
Power purchase agreements with 165 MW Attock Gen Limited is also on the card. The total cost of Attock Energy is Rs 51.35 per unit, which includes Rs 36.28 per unit on account of energy purchase price and Rs 15.07 per unit capacity payments. The plant receives Rs 10.609 billion annually which includes Rs 7.496 billion on account of EPP and Rs 3.113 billion as capacity payment.
The government has also decided to terminate the contract with 126 MW Tapal Energy.Tapal Energy Ltd was established in 1997. Termination of contracts with these IPPs will reduce capacity payments and electricity tariff.So far, the federal government has terminated contracts with 13 IPPs.