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ISLAMABAD: Federal Government and Karachi Electric (KE) will sign a new Power Purchase Agreement (PPA) by next month for which negotiations between the concerned entities are in progress.

This was disclosed by Additional Secretary Power Division/ CEO CPPA-G Waseem Mukhtar at a meeting of Senate Standing Committee on Power presided over by Senator Saifullah Abro. During discussion, a difference of opinion was witnessed between the Power Division and KE on stock of receivables/payables. KE is receiving about 1300 MW electricity from national grid sans PPA which had expired in 2015.

Chief Operating Officer (COO) KE Aamir Zia informed the Committee that total amount of KE’s receivables were Rs 321 billion as of August 2021, of which Rs268 billion are Tariff Differential Subsidy (TDS) claims whereas Rs 28 billion are overdue from KWSB (strategic customer), Rs 11 billion from CDGK and other provincial entities and Rs 18 billion from PSM, GoB and other federal entities. On the other hand, stock of KE’s payables was Rs 263 billion, of which the share of CPPA-/ NTDC was Rs235 billion, SSGC Rs 14 billion and other federal and provincial dues were about Rs 14 billion

Chairman Standing Committee argued that KE should pay Rs 48 billion to government which were due since 2008, adding actually KE is responsible for circular debt.

However, Additional Secretary Power Division apprised the committee that negotiations on Terms of Reference (ToRs) are being finalised to resolve dispute on payables and receivables between KE and government entities.

He said an arbitration panel comprising two or three retired judges of the Supreme Court will decide on this issue.

Chairman Standing Committee expressed displeasure at the absence of CEO KE, Syed Moonis Alvi, from the meeting. He asked COO KE to convey Committee’s displeasure to him.

The Committee also directed Power Division to scrap tests of Linemen conducted by Khyber Medical College (KMC) for Peshawar Electric Supply Company (Pesco) as open cheating was witnessed by the entire world on television screens.

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