Kot Addu Power Clarifies Operations Post-PPA Expiry Amid Speculations

Karachi: Kot Addu Power Company Limited has addressed circulating speculations suggesting that it has received payments for electricity it did not generate. The Company confirmed its compliance with contractual commitments following its privatization by the Government of Pakistan in 1996.

According to information available from the Pakistan Stock Exchange (PSX), the Company entered into a suite of agreements, including the Power Purchase Agreement (PPA), initially set to expire in June 2021. Following a resolution of disputes over liquidated damages, the agreement was extended by approximately 16 months until October 24, 2022, during which the Company maintained power plant availability without charging capacity payments.

Post-PPA, the Kot Addu power plant shifted to preservation mode, pending tariff determination by the National Electric Power Regulatory Authority (NEPRA). The Company has been providing a 220KV-132KV switchyard facility to the Power Purchaser since the PPA’s expiry without compensation, aiding the MEPCO Region and National Grid operations at the request of the Ministry.

It was further clarified that no capacity payments have been made to the Company since October 24, 2022. Payments received post-expiry relate to overdue receivables duly reported in the Company’s financial statements, ensuring transparency and adherence to fiscal obligations.

The Certificate Holders of the Exchange have been duly informed of these developments.

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