ISLAMABAD: An audit has given a clean chit to circular debt payments of Rs342 billion to independent power producers (IPPs), the Senate was informed on Thursday.

Minister of State for Water and Power Abid Sher Ali informed the house that during the last six financial years, Wapda’s Office of the Director General (Audit) had been auditing payments made to IPPs through Wapda Power Purchase Organisation and the Central Power Purchasing Agency (CPPA).

He added that further audit of circular debt has been completed by a special third-party team. He said that according to the findings of the report, the liability of Rs341.958bn has been found to be correct and in agreement with power-purchase agreement (PPA) and National Electric Power Regularity Authority (Nepra) determination.

Answering another question, the minister said more than Rs35.25bn had so far been collected through Neelum-Jhelum surcharge included in the electricity bills in February 2008. It included Rs28.23bn collected from Punjab, Rs3.57bn from Khyber Pakhtunkhwa, Rs2.13bn from Sindh and Rs1.30bn from Balochistan.

He said the surcharge was levied to meet the requirement of local component of the project. Approval in this regard was given by the Economic Coordination Committee in August 2007 and was also incorporated in second revised PC-1 which was approved by the Executive Committee of the National Economic Council (Ecnec) in July last year.

Published in Dawn, October 31st, 2014