The Senate Standing Committee on Economic Affairs exposed serious concerns regarding payments, settlements, and debt obligations to Independent Power Producers (IPPs) in Pakistan. Chairman Senator Saifullah Abro expressed alarm that the Power Division had not disclosed full details of capacity and settlement payments, interest obligations, and contractual liabilities. The committee warned that failure to provide transparency could undermine parliamentary oversight and questioned the ministerial authority responsible for withholding information.
A significant portion of the session focused on the Dasu Hydropower Project (DHPP) and its associated 765 kilovolt transmission line. Officials informed the Committee that the revised PC 1 cost of the project stands at Rs. 1,737 billion, and upon completion, it will generate 5,400 megawatts, making it the largest hydropower project in the country. Twelve generating units will initially provide 4,320 megawatts, followed by three additional units producing 360 megawatts each. Physical progress is reported at 30 percent, but repeated delays and discrepancies in official records such as contradictory signing and commencement dates have drawn criticism from committee members.
The Committee’s scrutiny intensified when discussion turned to Independent Power Producers (IPPs). Senator Abro demanded comprehensive disclosure of all capacity payments, settlement payments, outstanding liabilities, interest obligations, and the officials responsible for negotiating agreements. The Committee also sought updates on auctioned public sector power plants and related revenue. While the Power Division acknowledged that approximately Rs. 46 billion had been generated from scrap sales of defunct thermal plants, officials refused to disclose detailed records without ministerial approval. Senator Abro rejected this explanation, stating, “The minister is obliged to provide information to Parliament. If details are withheld, the Committee will pursue the matter at the highest level and place all facts before the public”.
Committee members raised serious concerns over financial inefficiencies, including the burden of interest payments. Senator Hidayatullah Khan noted that despite only 30 percent project completion, approximately $46 million had already been paid in interest on loans, including a $485 million loan for the Dasu Hydropower Project. Weak interdepartmental coordination and contractor performance issues were also highlighted as factors contributing to delays. Senator Rubina Khalid criticized administrative inefficiencies, urging the establishment of strict accountability mechanisms, while Senator Rana Mahmood-ul-Hassan stressed the need for timely reporting of future lapses to oversight institutions.
The Committee recommended that WAPDA provide a comparative study of previously completed projects, including the Neelum Jhelum Hydropower Project and Tarbela Dam, to evaluate efficiency and best practices. Members also examined the Mohmand Hydropower Project, noting funding constraints and a December 2028 completion target, and reviewed public donations collected under the National Dam Fund initiative, amounting to Rs. 24.5 billion currently held in the Federal Public Consolidated Fund.
Additional scrutiny was applied to the 765kV Dasu Islamabad Transmission Line Project. Committee members expressed strong displeasure over non-implementation of previous recommendations and raised alarm that absence of the transmission network at Dasu’s operational launch could result in an estimated daily loss of Rs. 2 billion. Concerns were amplified when it was revealed that the project contract had been awarded to a disqualified firm lacking the required expertise. The Committee directed NGC to provide SOPs, testing procedures, and relevant reports within two days and recommended imposing liquidated damages if the contractor failed to meet deadlines.
The session concluded with discussions on ongoing and completed Bus Rapid Transit (BRT) projects and alleged financial irregularities in the Sindh Solar Energy Project (SSEP), where Rs. 6 billion in taxes had allegedly been deducted based on fake invoices. Committee members directed the Energy Department, Government of Sindh, to expedite recovery of the funds and ensure accountability. The implementation status of Akram Wah Canal (SWAT Project) bids was also reviewed, revealing unusually high bids of Rs. 19 billion for Lot I and Rs. 17 billion for Lot II compared to estimates of Rs. 11 billion per lot which the Committee observed may favor certain companies, prompting correspondence with the World Bank regarding cancellation of the bidding process.
