ISLAMABAD: The Private Power Infrastructure Board (PPIB) has unanimously decided withdrawal of all suits, applications, petitions against the Independent Power Producers (IPPs) subject to simultaneous withdrawal of all proceedings, applications and writs filed by the IPPs against PPIB.
The PPIB, while considering the recommendations of a project committee, took this decision unanimously in its 138th meeting held on March 16, 2023 under the chairmanship of Secretary, Ministry of Energy (Power Division).
According to available documents, Managing Director (MD) PPIB apprised the Board meeting that in 2011 an issue arose between IPPs and National Transmission and Desptach Company (NTDC) on account of delay/non-payment under Power Purchase Agreements (PPAs). The IPPs claimed that they were unable to meet the capacity obligations under the respective PPAs due to non-payment of invoices by NTDC, resulting in their inability to procure fuel. Therefore, IPPs claimed that they were ‘deemed available’ under their respective PPAs and NTDC was not entitled to deduct capacity payment thereunder. This triggered a series of litigation and London Court of International Arbitration (LCIA) arbitration before various courts/forums.
Later, the federal cabinet constituted a committee to negotiate with IPPs and after successive rounds of discussions, a settlement agreement was reached with IPPs, whereby it was agreed that all pending legal claims will be withdrawn upon satisfaction of the settlement terms. In view of settlement agreement (SA), honourable Supreme Court of Pakistan (SCP) disposed of a Civil Petition for Leave to Appeal (CPLA) arising out of one of the orders of Lahore High Court and in light of SCP’s decision and terms of SA, all litigation for/against GoP now needs to be withdrawn.
Considering recommendations of the project’s committee, the Board unanimously decided to approve withdrawal of all suits, applications, petitions by Government of Pakistan (GOP)/PPIB against the IPPs subject to simultaneous withdrawal of all proceedings, applications and writs filed by the IPPs against GoP/PPIB in respect of disputes whether through a joint statement or otherwise as deemed appropriate, said documents.
