The National Electric Power Regulatory Authority (NEPRA) acknowledged differences within the authority on IPP (Independent Power Producer) contracts inn a public hearing on the Central Power Purchasing Agency’s (CPPA-G) fuel cost adjustment (FCA) request for June.

NEPRA Chairman Waseem Mukhtar blamed the Power Division for the IPP agreements, asserting that sovereign contracts cannot be opened unilaterally, though a request can be made to the sponsors.

The CPPA-G had sought a positive adjustment of Rs 2.63 per unit for June 2024. According to the CPPA-G CEO, consumers will pay an FCA of Rs 3.33 per unit in July’s bills, but they will pay Rs 2.63 per unit in August 2024, resulting in a reduction of Rs 0.70 per unit in their bills to recover an additional amount of Rs 34.38 billion.

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NEPRA Chairman hinted that the effective reduction may be Rs 0.75 per unit.

During the hearing, questions were raised about the substantial reduction in demand, new generation plants, the shifting of industry from the grid to solar, consumer tariff structure, peak hours, and IPP contracts.

Responding to a question regarding the opening of IPP contracts, NEPRA Chairman Waseem Mukhtar said that the Power Division deals with IPP agreements, and the regulator can only assist if the Division decides to proceed with it.

The issue of IPP agreements has been under scrutiny at all forums, including the business community.