Spokesman Report
Islamabad: Dr. Shahid Rasheed Butt, former President of the Islamabad Chamber of Commerce and Industry (ICCI), stated on Sunday that new IPPs are allowed despite the country’s power generation capacity being much higher than consumption.
He said permitting and constructing new IPPs is a bad idea and contrary to national interests.
Shahid Rasheed Butt said in a statement issued here today that an immediate ban should be imposed on the construction of all types of private power plants in Pakistan.
He added that while certain influential sections of society benefit from private power plants, the people and the economy suffer.
The business leader said that the power generation capacity is forty-five thousand megawatts. Still, the transmission capacity is only twenty-six thousand megawatts.
Despite this, efforts to boost generation capacity and neglect the upgrade of power transmission is a grave mistake that will further harm the fragile economy.
He said that our experts either cannot negotiate with investors or make such agreements for personal interests, which makes them prosperous. Still, the people become miserable, and the country goes bankrupt.
He noted that Pakistan buys very expensive electricity compared to neighboring countries, and new scam records are being set. Still, no action has ever been taken against the people involved.
The general public is told that IPPS receives 17 percent of profits in dollar terms. When measured in rupees, many preferred IPPs receive between 40% and 87% of profits.
Many IPPs are kept closed but paid billions of rupees in capacity payments. According to a report, sixteen IPPs have received payments totaling Rs 415 billion up to 2020, and this process is still ongoing. These 16 IPPs had invested a total of Rs52 billion.
Shahid Rasheed Butt asserted that no nation agrees to provide investors with a seventeen percent profit in dollars at zero risk, nor does it offer a profit in dollars to those investing in local currency. Furthermore, no country pays 100% capacity charges, but Pakistan has done so for obvious reasons.
He questioned the rationale behind setting up an imported coal plant in Sahiwal, noting the impracticality of such projects operationally and environmentally.
He suggested that such plants should be located near ports. The cost of imported coal was initially Rs 3 per unit. Due to the devaluation, it has increased to over Rs 12 per unit.
The government must switch power plants from imported coal to local coal, which could save consumers Rs2 per unit, as four plants in Jamshoro, Sahiwal, Port Qasim, and Hub use imported coal.
According to Mr. Butt, all agreements guarantee that the elite reap the benefits while the people shoulder the full burden. He said that the country would face default if the IPPs established under CPEC demanded payment of outstanding dues.
