IPPs “received Rs9.79b capacity payments” in a single year

ISLAMABAD: The Ministry of Energy (Power Division) reported to the National Assembly that the independent power producers (IPPs) secured a total of Rs9.79 billion in capacity payments from consumers.

The money was collected during the fiscal year July 2023 till June 2024.

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Capacity payments are important for compensating power producers for supplying electricity to designated consumers, even when the IPPs do not fully utilise their available capacity.

Among the major beneficiaries is China Power Hub Generation Company that received Rs137 billion. The company is supposed to increase foreign investment in Pakistan’s energy sector, particularly from China.

China has in recent years contributed to the increasing demands for energy by the nation of 240 million. China has invested heavily in the country’s power sector through the China-Pakistan Economic Corridor (CPEC).

Similarly, Huynh Shindom Energy received a payment of Rs113 billion. The Port Qasim Electric Power Company reported earnings of Rs120.37 billion during the same period.

The breakdown of payments revealed that eight coal-fired IPPs collectively received Rs7018 billion, while eleven 11 gas-fired IPPs garnered Rs72.63 billion.

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Meanwhile, three hydroelectric IPPs received Rs106 billon while eleven furnace oil-fired IPPs were allocated Rs81.60 billion in capacity payments.