Power generation merger hits bureaucratic roadblock

ISLAMABAD: The bureaucratic set-up in the Power Division and its subordinate state-owned entities are resisting a reform process to merge oil-based, redundant, old power generation companies into the National Power Parks Management Company (NPPMC), despite a decision by the National Task Force on Energy and by Power Minister Sardar Awais Khan Leghari.

Informed sources told Dawn that these four generation companies (Gencos 1 to 4) had become redundant after the auction or closure of their old power plants, mostly as scrap, as part of the tariff reduction efforts that also included renegotiations with the independent power producers leading to a purported over Rs4 trillion savings over the remaining lives of all IPPs and government owned power plants.

Hundreds of their employees, including officers and engineers, were, therefore, transferred to the Distribution Companies (Discos) until March 31 as a temporary arrangement.

Following a series of meetings, the task force led by Lt Gen Zafar Iqbal and Mr Leghari, which concluded in the last week of February, decided to merge 660MW Jamshoro, 747MW-Guddu, 525MW Nandipur plant and Lakhra Power (Genco 1 to 4), and their parent company GHCL would be merged with NPPMC – a relatively lean and modern entity that was also operating LNG-based power plants.

The bureaucrats who mostly form part of the board of directors of Gencos and GHCL wanted their corporate perks and allowances, including vehicles, fuel and staff to continue, instead........

© Dawn Business