07-18-2009, 04:24 PM
<b>Massive power shortage looms as IPPs threaten to stop supply </b>
KARACHI (July 18 2009) The city is likely to face a massive power shortage of over 250MW, as the Independent Power Producers (IPPs) have threatened to stop supply to Karachi Electric Supply Company (KESC), which is yet to pay their outstanding dues of over seven billion rupees.
The IPPs had not been paid the dues by KESC for the period October 2008 to July 2009, sources told Business Recorder on Friday. Gul Ahmed and Tapal, the two IPPs, have been supplying over 250 MW to the company since 1997. According to the sources, the IPPs were giving the warning of disconnection of power to KESC, following a threat they received from the oil companies. The oil companies have also threatened the IPPs of stopping the supply, if the outstanding dues are not cleared immediately, the sources added.
They said due to non-payment of the dues by KESC, the private power producers were also unable to pay outstanding to the oil companies. The sources also claimed that after the expiry of 10-year agreement with these IPPs, the company would also not want to get the full supply of electricity from these power producers.
According to the agreement between the IPPs and KESC, the company had to purchase electricity on fixed rates without any reduction in the supply for 10 years. Another source said Gul Ahmed has already stopped supply to KESC since 6pm on July 16. In a letter (F-GOP-L09-00027), sent to President Asif Ali Zardari, on July 15, 2009, Gul Ahmed has stated that as a result of persistent and continuing defaults by KESC it could not continue supply.
It said as a result of no less than 29 separate failures and defaults by KESC under the Power Purchase Agreement (PPA), Gul Ahmed is currently owed a sum of Rs 3.03 billion for the period October 2008 to July 2009. "At present furnace oil prices and the private power producer need Rs 30 million per day to keep the plant operational," it said.
In the letter, the IPP also said that since 1997, it has been continuously supplying power to KESC as per the company's demand and without fail, and has met all contractual obligations under the PPA. However, in a news briefing, Jan Abbas Zaidi, the Chief Operating Officer for Distribution, KESC confirmed that the supply has been disconnected by Gul Ahmed while Tapal was supplying the electricity continuously.
He said that KESC has also not received its receivables of at least Rs 36 billion from different government, semi-government and general consumers. According to official sources, though the company was trying to enhance its power generation capacity, the agreement with these IPPs was intact.
<i><b>Copyright Business Recorder, 2009</b></i>
http//www.brecorder.com/index.php?id=937059&currPageNo=1&query=&search=&term=&supDate=
KARACHI (July 18 2009) The city is likely to face a massive power shortage of over 250MW, as the Independent Power Producers (IPPs) have threatened to stop supply to Karachi Electric Supply Company (KESC), which is yet to pay their outstanding dues of over seven billion rupees.
The IPPs had not been paid the dues by KESC for the period October 2008 to July 2009, sources told Business Recorder on Friday. Gul Ahmed and Tapal, the two IPPs, have been supplying over 250 MW to the company since 1997. According to the sources, the IPPs were giving the warning of disconnection of power to KESC, following a threat they received from the oil companies. The oil companies have also threatened the IPPs of stopping the supply, if the outstanding dues are not cleared immediately, the sources added.
They said due to non-payment of the dues by KESC, the private power producers were also unable to pay outstanding to the oil companies. The sources also claimed that after the expiry of 10-year agreement with these IPPs, the company would also not want to get the full supply of electricity from these power producers.
According to the agreement between the IPPs and KESC, the company had to purchase electricity on fixed rates without any reduction in the supply for 10 years. Another source said Gul Ahmed has already stopped supply to KESC since 6pm on July 16. In a letter (F-GOP-L09-00027), sent to President Asif Ali Zardari, on July 15, 2009, Gul Ahmed has stated that as a result of persistent and continuing defaults by KESC it could not continue supply.
It said as a result of no less than 29 separate failures and defaults by KESC under the Power Purchase Agreement (PPA), Gul Ahmed is currently owed a sum of Rs 3.03 billion for the period October 2008 to July 2009. "At present furnace oil prices and the private power producer need Rs 30 million per day to keep the plant operational," it said.
In the letter, the IPP also said that since 1997, it has been continuously supplying power to KESC as per the company's demand and without fail, and has met all contractual obligations under the PPA. However, in a news briefing, Jan Abbas Zaidi, the Chief Operating Officer for Distribution, KESC confirmed that the supply has been disconnected by Gul Ahmed while Tapal was supplying the electricity continuously.
He said that KESC has also not received its receivables of at least Rs 36 billion from different government, semi-government and general consumers. According to official sources, though the company was trying to enhance its power generation capacity, the agreement with these IPPs was intact.
<i><b>Copyright Business Recorder, 2009</b></i>
http//www.brecorder.com/index.php?id=937059&currPageNo=1&query=&search=&term=&supDate=