The federal government has announced the formation of an eight-member task force for structural reforms, in a move aimed at addressing the critical issues in the energy sector.

Approved by Prime Minister Shehbaz Sharif, the notification for the establishment of this task force has been officially released.

The task force is mandated to tackle the pressing issue of billions of rupees in capacity payments to Independent Power Producers (IPPs) and to revise the existing contracts. The task force will submit a comprehensive report, including recommendations and an implementation plan, to the prime minister within a month.

Federal Minister for Energy Sardar Awais Ahmed Khan Laghari has been appointed as the chairman of the task force, with Special Assistant to the Prime Minister on Energy Muhammad Ali serving as the co-chairman. Lt Gen (retd) Muhammad Zafar Iqbal has been designated as the national coordinator, and senior bureaucrat Zakaria Ali Shah as a member of the task force.

IPPs task force

The task force will also include one representative each from NEPRA, the Central Power Purchasing Agency, the Private Power and Infrastructure Board, and the SECP. The special secretary for the Power Division will head the secretariat of the task force.

The task force will review measures to reduce capacity payments and suggest necessary actions, including the potential closure of power plants. It will also scrutinize the set-up costs of various IPPs, identifying corruption, procedural weaknesses, and regulatory gaps. Additionally, the task force will examine IPP contracts and propose solutions to address the issue of circular energy debt.

The task force will monitor the implementation of structural reforms in Pakistan's power sector and will have broad powers to fulfill its duties. It can select experts from both the public and private sectors and may seek records, information, or assistance from international consulting firms, bankers, legal advisors, chartered accountants, or any other organization.

Furthermore, the task force will recommend measures to improve the management and finances of the energy sector and develop strategies for utilizing excess energy capacity in industries. The federal government will provide the necessary budget and full support to the task force, with the Ministry of Energy maintaining effective communication and consultation.

This decisive action by the federal government underscores its commitment to overcoming the longstanding challenges in Pakistan's energy sector and ensuring sustainable and efficient energy management for the country's future.