Acting President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Abdul Mohamin Khan, announced that the FPCCI will present its case against the high-capacity charges of Independent Power Producers (IPPs) to the Supreme Court of Pakistan (SCP) and the Special Investment Facilitation Council (SIFC). This move is seen as a last resort to protect the economy and the people of Pakistan from unbearable financial burdens.
Abdul Mohamin Khan emphasized that despite the business community’s continuous concerns about the excessive capacity charges imposed by IPPs, their input has been largely ignored in the consultative process. He stressed that the business community, being a primary stakeholder, should be involved in resolving this critical issue.
The Acting President of FPCCI laid out a charter of demands for the power sector, which includes: Ordering a forensic audit of independent power producers (IPPs). Abolishing capacity charges and only paying for the electricity generated. Renegotiating power purchase agreements with IPPs in a fair and transparent manner.
Khan revealed that the country paid approximately Rs 2,000 billion in capacity charges in FY24, with projections indicating a steep rise to Rs 2,700-2,800 billion in FY25. He further explained that guarantees to IPPs indexed to the US dollar mean that any depreciation of the Pakistani rupee increases returns for IPPs, placing an additional financial burden on the government and the public. The FPCCI is calling for a comprehensive review of IPP agreements, price re-evaluation within legal bounds, and improved oversight to prevent over-invoicing. These steps are seen as essential to mitigate the financial strain on Pakistan’s economy and ensure fairer electricity pricing for consumers.
