Pakistan sets up task force to reform power sector, shut down some IPPs

Pakistan Prime Minister Shehbaz Sharif has approved an eight-member task force for implementing structural reforms in the power sector, with a mission to make it financially and operationally sustainable.

A notification issued by the Prime Minister's Office on Sunday stated that the task force would be headed by Minister for Power Sardar Awais Ahmad Khan Leghari. Special Assistant to the Prime Minister on Power Muhammad Ali would be the co-chairperson, and Lt. Gen Muhammad Zafar Iqbal would be the coordinator.

Other members include Syed Zakaria Ali Shah from the Secretariat Group, and one nominee each from the National Electric Power Regulatory Authority, Central Power Purchasing Agency, Private Power and Infrastructure Board, and Securities and Exchange Commission of Pakistan.

The task force can engage and seek records and information or assistance from local and international consultancies, bankers, legal advisors, chartered accountancy firms, and other organizations or individuals as deemed necessary.

The task force's terms of reference include:

• Recommending measures for making the power sector financially and operationally sustainable
• Overseeing the development of an efficient and liquid power market design along with its implementation
• Recommending utilization of excess capacity by industries/special economic zones for stimulating growth
• Reviewing and recommending measures to reduce capacity payments, including but not limited to shutting down certain plants and taking any other necessary measures as deemed appropriate
• Reviewing matters pertaining to the set-up cost of various Independent Power Producers (IPPs) in the country and identifying malpractices, procedural weaknesses, and regulatory gaps with recommendations for rectifying them
• Reviewing compliance of IPPs with parameters/ terms and conditions of various agreements signed with relevant government agencies/institutions
• Recommending measures to resolve the issue of circular debt in the energy sector.