December 28, 2023 (MLN): In a trailblazing move tackling the persistent circular debt crisis within the energy sector, the government has swiftly disbursed a staggering sum of around Rs200 billion among power companies, according to sources.
Out of the stated amount Rs140bn have been disbursed to Generation Companies (GENCOs) while Rs57bn to K-Electric.
What makes this progress noteworthy is the mandate laid down by the International Monetary Fund (IMF), specifying that the companies receiving these funds are obliged to affect a cash settlement. As a result, there is a strong likelihood that these entities will channel hefty dividends to their shareholders.
This noteworthy initiative not only aims at mitigating the mounting burden of circular debt in the power sector but also entails a partial resolution of the gas circular debt through GPP payments to major Petroleum sector entities, primarily petroleum and Sui companies.
Recently, the Economic Coordination Committee (ECC) has approved the summary of Power Division for settlement of payables to Government Owned Power Plants (GPPs) at par with IPPs and directed to release Rs262.075bn to public sector power plants through technical supplementary grant.
To execute this plan effectively, the approval of a Technical Supplementary Grant amounting to Rs262bn in Investment Head A014 under the Power Division's demand for investment in DISCOs is imperative.
Meanwhile, an agreement has been reached to release Rs131.035bn in the 2nd quarter, with the remaining slated for release in the remaining quarters of FY24.
This allocated sum is earmarked for distribution in the 2nd quarter, including a payment of Rs131bn to GPPs, allocating Rs26.78bn to GENCO-II, Rs2.965bn to GENCO-III, Rs83.63bn to WAPDA, Rs16bn to Quaid-e-Azam Thermal Power (RLNG), and Rs1.635bn to Quaid-e-Azam Solar Power.
Notably, earlier reports from the media had unveiled that the Finance Division sought comprehensive expenditure particulars regarding the Rs601bn allocated to the Power Division, specifically for settling obligations of Independent Power Producers (IPPs) and GPPs.
Copyright Mettis Link News
Posted on: 2023-12-28T14:25:40+05:00
