Chinese companies refuse to renegotiate IPPs capacity charges: report

Chinese companies have ruled out the possibility of renegotiating the power purchase contracts under IPPs.

According to a report of The Express Tribune, representatives of three large Chinese companies said that the matter of whether to restructure the energy debt should be decided between the Chinese banks and the Pakistani authorities.

However, they ruled out the possibility of renegotiating their own terms and conditions, which were related to their profits and the idle capacity payments, and agreed under the Power Purchase Agreements.

Finance Minister Muhammad Aurangzeb leaves early Wednesday (today) to meet with Chinese authorities to seek an extension in repayment of the debt that the government of Pakistan and the Chinese companies have taken from the Chinese financial institutions for setting up power plants.

Pakistan had taken the debt to set up nuclear power plants, while the Chinese companies took these loans for the power plants setup under the CPEC.

A Power Division official said that the estimated value of the outstanding debt was around $17 billion for both nuclear plants and CPEC energy projects.