LAHORE, Oct 17: Some Independent Power Producers (IPPs) have begun lobbying government officials for getting Rs2.69 billion fines, known in technical parlance as liquidated damages (LDs), waived. The Pakistan Electric Power Company (Pepco) had slapped the fines on the IPPs which had failed to meet their start-up deadlines in 2009.
As per the contracts, the Pepco worked out LDs of $31.72 million (Rs2.69 billion) for nine IPPs that missed the deadlines last year, sources said. Missing the deadlines had led in part to the authorities' failure to end loadshedding by December last year.The LDs cover the period up to Oct 9, 2010, and the fines will increase because some of the IPPs have yet to become operational.
The ministry of water and power has denied entertaining any requests from owners of the IPPs to waive off the fines, but some finance ministry officials said they were under considerable pressure to move a summary about the LDs' waiver.
According to Pepco calculations, the Attock Gen Ltd (156MW) was supposed to start its operations on Jan 24, 2009, but came online on March 17, a delay of 52 days. As a result, it is supposed to pay a fine of $667,513.
The Atlas Power Project (213MW) should have come online on March 31, 2009, but began producing electricity on Dec 18, a delay of 262 days. It is supposed to pay $4.6 million in fines.
The Saif Power Project (209MW) became operational 20 days behind schedule and has been fined $344,854 as per the terms of its contract. The Orient Power Project (212MW) was supposed to start generating electricity on April 15, 2009, but came online on May 24, 2010, and should pay a fine of $7 million.
The Nishat Power Ltd (195MW) should have become operational by Dec 31, 2009, but started production on June 9, 2010, and $2.56 million should be recovered from it.
The Nishat (Chunian) Power Project (195MW) will have to pay a fine of $337,880 because it started operations 21 days after the due date. The Sapphire Electric Power Project (225MW) got delayed by 351 days and $6.49 million should be recovered from it.
The Foundation Power Project (202MW), which should have been online by Oct 7, 2009, has still not been able to start production. The LDs against it amounted to $6 million as of Oct 9.
The Hub (Narowal) Power (225MW) got delayed by 192 days (up to Oct 9) and should be fined $3.5 million. Since it has yet to come online, its fine will be recalculated once it stars its operations.
The Halmore Power Project 225MW) and the Liberty Power Tech (200MW) got their deadlines extended to December 2010 and their cases would be dealt with later.
