ISLAMABAD: The Supreme Court summoned on Monday secretaries of ministries of finance and water and power for having reneged on a plan to pay Rs8 billion to independent power producers.

During previous proceedings, the Supreme Court was informed that under an agreement reached with the government the IPPs would receive Rs8 billion by Aug 30 of the Rs45 billion which is to be paid to them in three instalments.

A committee comprising secretaries of finance, water and power, law and establishment division looking into the issue of circular debt had devised a formula under which a backlog of Rs8 billion had already been cleared by the government on July 23.

But Advocate Khalid Anwar representing the IPPs told a Supreme Court bench comprising Justice Nasirul Mulk and Justice Ijaz Ahmed Chaudhry on Monday that the government had not paid the second instalment of Rs8 billion to the power producers on Aug 30, despite the fact that the country was still reeling under crippling loadshedding and power blackouts.

The counsel regretted that the power companies could add to the national grid only 50 per cent of their capacity because of non-payment of arrears and the erratic payments were responsible for the non-production of badly needed electricity to 100 per cent capacity.

The apex court had taken up eight separate petitions seeking a direction against the government to clear the circular debt which has swelled to Rs400 billion and is partly responsible for loadshedding.

Liberty Tech, Orient Power, Atlas Power Limited, Nishat Power, Nishat Chunian, Saif Power, Halmore Power, and Sapphire Electric have filed he petitions for payment of the outstanding dues of Rs11.131 billion, Rs4.121 billion, Rs10.478 billion, Rs9.661 billion, Rs10.899 billion, Rs5.722 billion, Rs2.415 billion and Rs6.974 billion, respectively.

The IPPs, which earlier had invoked the sovereign guarantees, moved the petitions for getting the outstanding dues cleared, pleading that the step would help ensure continued availability of electricity from the IPPs.

An official of the finance ministry told the court that weak financial health was responsible for the delay in payment of Rs8 billion but hoped that it would be done in two to three weeks.

However, Advocate Anwar feared that there would be more loadshedding in the country if the government failed to pay dues of power producers.

The counsel representing the water and power ministry assured the court that the payment would be made by Sept 8, adding that it was the responsibility of the government to provide electricity to consumers.

The hearing was adjourned to Sept 12 when the secretaries of finance and water and power will appear before the court.