Bagasse-based IPPs tariff delinked from imported coal cost in dollar

ISLAMABAD: In another meaningful development, the task force on power has de-linked power tariff of bagasse-based IPPs of 225 MWs from dollar-based imported coal cost.

“Their tariff is to be in Pak rupee from now onwards which will help government save over Rs100 billion in the remaining period of their contracts,” top official sources told The News. This decision was made by the task force on power after interacting with all the bagasse-based IPPs of 225 MWs here on Tuesday. The said IPPs are the must-run projects, and the tariff was linked with imported coal in dollar terms, sources said.

However, the sitting government, sources said, has also extended full support to the task force to make a deal with bagasse-based IPPs which will help save Rs100 billion plus.

One bagasse-fired IPP also confirmed to The News the task force has scratched down their existing tariff based on imported coal cost. Now, they would be paid through Pak rupee-based tariff, and to this effect a new petition would be submitted to Nepra.

This is the second achievement of the task force on the power sector. Earlier, it successfully managed to get PPAs of five IPPs (four set up under 1994 and one under 2002 power policy) terminated through fair talks, saving Rs411 billion in the remaining period of their contracts.

From next week, the task force is going to initiate talks with 18 IPPs more set up under 1994 and 2002 power policies to change their contracts on take and pay mode from existing take or pay mode.