ISLAMABAD – The Finance Ministry and the Energy Ministry proposed measures to address the escalating issues stemming from the significant circular debt in the energy sector.
The sources said that they recommended making a one-time payment of Rs4 trillion to the Independent Power Producers (IPPs) as capacity charges, aiming to alleviate the burden on frustrated electricity consumers.
The strategy for a lump-sum payment to the IPPs is designed to mitigate the circular debt crisis.
The payments could potentially be spread over three to five years, which may result in a reduction of electricity prices by Rs5 per unit.
The Finance Ministry has been assigned the responsibility of securing the necessary financing for this substantial payment to the IPPs.
The sources said that the final decision on this proposal would be made following discussions with the International Monetary Fund (IMF).