Federal Minister for Energy Owais Leghari revealed that renegotiations with independent power producers (IPPs) are already reducing electricity prices, with further potential for significant relief.
Speaking during a briefing to the National Assembly’s Power Committee, the minister said electricity tariffs could decrease by Rs10–12 per unit after the finalisation of agreements.
Leghari disclosed that 75% of electricity costs stem from capacity charges imposed by IPPs. “The impact of revising these agreements is being passed on to the public,” he stated, adding that contracts with 12 IPPs, including bagasse-based plants, have been reviewed, with talks completed for 15 more.
“The cabinet will approve these revisions next week, while decisions regarding captive power plants will be finalized within a month,” he added.
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The minister also shared that five IPP contracts have been terminated, and revisions for eight bagasse power plants have been approved. Discussions are underway with 16 additional IPPs, including government-owned plants. As a result of these renegotiations, domestic consumers have already received relief of Rs4 per unit in electricity tariffs.
Addressing concerns over electricity theft in Khyber Pakhtunkhwa (KP), Leghari accused the provincial government of failing to cooperate despite prior agreements. He revealed that the KP chief minister had demanded unrestricted electricity supply to feeders with high theft rates before committing to remove illegal connections.
“We implemented this agreement for 75 days, yet the provincial administration failed to remove the hooks, resulting in an additional loss of Rs6 billion for our company,” Leghari said.
Loadshedding and K-Electric tariff
Committee members raised concerns over ongoing load shedding in KP, prompting further discussions. Leghari criticized K-Electric’s multi-year tariff as a heavy burden on consumers, stating, “The proposed tariff is unjustifiable in our opinion.”
Walkout
During the meeting, a proposal to address issues related to power supply companies in Hyderabad and Sukkur behind closed doors prompted a walkout by committee members Shehryar Mehr, Sher Ali Arbab, and Junaid Akbar.
The energy minister reaffirmed the government’s commitment to easing the financial burden on consumers through reforms in the energy sector, particularly by addressing inefficiencies and renegotiating contracts with IPPs.
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