In an unprecedented move, the Economic Coordination Committee of the Cabinet (ECC) on Friday approved sovereign guarantee against financing facility of Rs 10.4 billion from local banks for interconnection of imported coal based 1,320 MW power plants at Bin Qasim, Karachi.
The meeting of the ECC was chaired by Finance Minister Ishaq Dar and considered proposals from Ministry of Water and Power, Ministry of Petroleum and Revenue Division.
On a proposal submitted by Ministry of Water and Power, the ECC approved in principle to the transfer of all the hydropower projects, based on BOOT model, being implemented under the Power Policy 2002, to the respective provincial, AJK, Gilgit-Baltistan governments after expiry of the term of the Implementation Agreement.
The ECC also approved enhancement of Water use charges (WUC) from Rs 0.15/kwh to Rs 0.425/kwh for all upcoming private sector hydropower projects being implemented under the 2002 Power Policy which have not yet achieved Financial Close. It was also decided that the WUC would be reviewed every five years to determine if an increase is required.
On another proposal from the Ministry of Water and Power, the ECC granted approval for authorising CPPA to sign amendment to the modified and re-stated power purchase agreement with Fauji Kabirwala Power Company.
Considering the proposal submitted by the Ministry of Petroleum and Natural Resources, the ECC allowed allocation of up to 9.5MMCFD gas from Badar-2 gas field to SNGPL. The price of gas would be as per the applicable Petroleum Policy. The decision has been taken keeping in view the request of SNGPL for allocation of gas from Badar-2 owing to increasing demand and supply gap in their system.
The ECC also approved proposal of the Revenue Division for extending reduced withholding tax rate of 0.4 per cent for non-filers up to July 31, 2016.
