Cases / Law, regulation and treaties · Pakistan · 2024–2025
Pakistan cancels five independent power contracts amid capacity-payment costs
Short record: the main facts, with sources. A full case file has not been prepared.
Nature's voice · report
No measurement of the harm done to me here is on record.
Did nature suffer? Not measured.
Not on record
- The record does not name which of my species, waters, soils or forests were harmed.
Pakistan paid 2.1 trillion rupees in capacity payments to independent power producers in fiscal 2024, then cancelled five contracts under IMF pressure. The sources record no environmental effect of either step.
What?
The government ended five independent power contracts, including Hubco, under IMF pressure. Dawn
Where?
Pakistan Dawn
When?
Capacity payments reached 2.1 trillion rupees in fiscal 2024; the contract terminations were reported on 4 December 2024. Dawn
Who?
Gained
- Independent power producers — Received capacity payments under take-or-pay contracts; most Pakistani plants are owned by local holding companies. Dawn
Lost
- Pakistan's government and power buyers — Pay for contracted capacity under take-or-pay terms; the sources do not establish how much of the claimed savings reached consumers. Profit (Pakistan Today); IEEFA
Harmed
None on recordWhy?
The government acted under pressure from the IMF, according to Dawn. Dawn
How?
Termination of five contracts and renegotiation with 14 plants and eight bagasse plants. Profit (Pakistan Today); IEEFA
6 of 6 questions answered from the record
What happened
The record, in order.
Capacity payments to independent power producers reached 2.1 trillion rupees in fiscal 2024, Dawn reported.
Under IMF pressure the government terminated contracts with five independent plants, including Hubco, and claimed savings of 411 billion rupees, Dawn reported.
Profit, citing IEEFA, reported that the government then renegotiated with 14 plants and eight bagasse plants and claimed lifetime savings of 1.333 trillion rupees; the effect on consumer bills is disputed.
In court and with insurers
Every proceeding and every insurer decision on record.
Lawsuits and rulings
No court case on record. No court has ruled on this case.
Insurers
No insurer decision on record.
What we don't know
Undisclosed, unproven, untried: recorded as data.
Nature
- Not measured Harm to nature: The record holds no measurement of harm to nature.
Record
- None on record The sources do not say what the 36.5 billion rupee figure for Hubco measures.
- Disputed The tariff effect is disputed: the government claimed a reduction of 7 rupees per unit, while producers estimated 0.5 rupees.
- None on record The source link for the renegotiation refers to eight IPPs, while the reported renegotiation covers 14 plants and eight bagasse plants.
- None on record The sources record no environmental outcome of the contract changes.
Did the harm stop?
Not stated in the sources reviewed.
Who paid?
Not stated in the sources reviewed.
Sources
Voices on record: — Company or project— Government and regulators— Courts✓ Press and investigations— Communities and civil society— Researchers
Press and investigations
- Report on Pakistan capacity payments and terminated power contractsDawn · 2024-12-04
- Report on renegotiated power purchase agreements with independent power producersProfit (Pakistan Today); IEEFA · 2024-11-30
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