Circular debt deepens power crisis

ISLAMABAD

The circular debt issue has further deepened power crisis in the country amid the reports that IPPs outstanding dues against the government have spiralled to whopping Rs 298 billion making it hard for private power producers to continue power production.
Citing to power sector sources a private TV channel has said lack of payments to the IPPs has set the financial crisis soaring at break neck pace. The impact of payments made by the government previously to power sector is fast diluting in the face of delay being caused by government in making further payments on account of circular debt. Power sector is facing tough time in keeping its production potential at higher level.
Sources said IPPs production capacity has risen against the previous year production. IPPs tapped 55 percent production capacity 55 during December 2012 to April 2013. They exploited 66 percent production potential following the payment made by the Nawaz-led government on account of circular debt on preferential basis.
Sources said outstanding dues payable by government to IPPs installed under 1994 policy has swelled to Rs 141 billion and such dues payable by the government to IPPs set up under 2002 policy has touched the mark of Rs 59 billion. The overall dues outstanding against GENCOs, Chashma Power and Hydropower project are hovering around 98 billion rupees.