Cabinet okays termination of contracts with five IPPs

What could be described as a big step towards reduction in the power tariff, the federal cabinet has approved the termination of contracts with five independent power producers (IPPs), reported 24NewsHD TV channel.

Quoting its sources, the TV channel reported that Prime Minister Shehbaz Sharif, while chairing the meeting in Islamabad on Thursday, expressed his resolve to provide relief to consumers in their electricity bills.

The step would save electricity consumers Rs60 billion annually and also save Rs411 billion for the national exchequer.  

Speaking on the occasion, the prime minister said that by the grace of The Almighty Allah, the country’s economy was stabilizing. “In the first phase, we are terminating contracts with five IPPs namely HUBCO, LALPIR, Saba Power, Rousch Power and Atlas Power,” he informed the meeting.

PM Shehbaz further said that the electricity prices would be reduced gradually by revisiting the agreements signed with other IPPs in the power sector. “PML-N President and my mentor Nawaz Sharif has always stressed the need for the provision of relief to the masses by slashing the power tariff.”

He went on to say that acting upon the advice of his mentor, he worked 24/7 to ensure that electricity prices were reduced so that the people could heave a sigh of relief. “People have sacrificed a lot during this period. It is high time that relief was provided to them now.”

The prime minister said that previously the inflation rate was over 30 per cent. “But now it has come down to 6.9 per cent which has brought comfort in the people’s lives,” he said, and added, “Hence the target which we had to achieve in 2025, was achieved in 2024.”

He also praised the IPP’s owners for preferring the country’s interests to their personal interests and agreed to terminate their contracts with the government voluntarily. “Thus they played a vital role in the provision of relief to the masses,” he said, and added, “The entire cabinet, including me, are thankful to them for that.”  

PM Shehbaz said that despite a difficult situation, the federal and the Punjab governments reduced the power tariff so that the consumers could heave a sigh of relief.

He said he would keep each and every promise he had made to the people.

The prime minister claimed that a record increase had been noticed in the remittances sent by overseas Pakistanis. “Record remittances worth $8.8 billion sent by them during the last quarter shows their trust in the government’s policies.”

Reporter: Awais Kiyani