ECC Approves Monthly Production Plan for Cost-Effective Electricity Production

Federal Minister for Finance, Revenue, Industries and Production, Muhammad Hammad Azhar, chaired a meeting of the Economic Coordination Committee (ECC) of the Cabinet today.

Power Division presented a summary regarding waiver of minimum 66% Take-or-Pay commitment in Power Purchase Agreement(s) (PPA) & Gas Supply Agreement(s) (GSA) of three RLNG based Public Sector Power Plants namely Quaid-e-Azam Thermal Power Plant, Balloki Power Plant, and Haveli Bahadur Shah Power Plant.

These amendments would envisage submission of a Monthly Production Plan (MPP) as binding on the Power Purchaser and the Power Seller wherein the Power Purchaser shall be entitled to submit demand requirement as needed, at least seventy five days before the start of each such month, which will be finalized by the System Operator and Operating Committee under the PPA.

The concept of a Monthly Delivery Plan (MDP) for deliveries of Gas under the GSA, has been paired with the Monthly Schedule as provided under PPA. The MPP will come into effect from the year 2022.

After seeking input from relevant stakeholders, the Committee approved the summary and appreciated the concept of Monthly Production Plan (MPP) as a cost-effective solution, enabling the Power and Gas purchasers to make requisite purchases in line with actual requirements instead of following a fixed arrangement.

Power Division also presented another summary proposing an amendment to the Facilitation Agreement and Amendment to the GoP Guarantee Agreement with KAPCO. It included the proposal that the project may be withdrawn from the Privatization Commission and entrusted to Private Power and Infrastructure Board (PPIB). After due deliberation, the Committee approved the summary, in principle, subject to formal vetting by the Law Division.

Secretary, M/o Commerce presented a summary before the ECC for withdrawal of Customs Duty on import of Cotton Yarns under PCT 5205, 5206, and 5207 till 30th June, 2021. The Committee approved the withdrawal of Customs duty to ensure smooth supply of cotton and cotton yarns to the value-added industry while bridging the gap between domestic production and overall demand for the inputs.

The ECC also approved a Technical Supplementary Grant for Finance division amounting to Rs. 11.7 billion as the share of the Federal Government for the establishment of 4 mother and child hospitals in Punjab.

Federal Minister for Planning, Development and Special Initiatives Asad Umar, Federal Minister for Privatization Muhammad Mian Soomro, Federal Minister for Maritime Affairs Ali Haider Zaidi, Federal Minister for Energy Omar Ayub Khan, Federal Minister for National Food Security and Research Syed Fakhar Imam, SAPM on Revenue Dr. Waqar Masood, SAPM on Power and Petroleum Tabish Gauhar, Federal Secretaries, senior representatives of Provincial governments, Chairman BOI and other senior officers participated in the meeting. Governor State Bank of Pakistan joined through a video link.

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