IMF shows flexibility on cutting off gas supply to Kapto power plants

  January 06, 2025

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Islamabad: The International Monetary Fund (IMF) has given the government more time to resolve the issue of cutting off gas supply to Kapto Power Plants. 

According to sources, the IMF responded positively to the government's request for more time on the issue of cutting off gas supply to the Kapto power plants and has given the government more time in this regard. 

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 Sources say that the Finance Ministry can comment on how much time has been given by the IMF, but we have been told that the IMF has shown flexibility in the deadline until the end of January.

Sources say that the government has previously ordered the disconnection of gas supply to Kapto Power Plants by the end of January 2025.

According to sources in the Ministry of Energy, the Power Division and the Petroleum Division have started working on various options, the mechanism is being determined and the numbers are being cross-checked.

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According to sources, there are 1,180 capto power plants in the country. These plants generate their electricity by consuming more than 150 million cubic feet of gas per day. These capto power plants purchase gas from the government at Rs 3,000 per MMBTU.

Sources say that the non-captive industry also has objections to the captive power plants. The non-captive industry has complaints about getting expensive electricity from the national grid. The national grid costs the non-captive industry up to Rs 15 per unit more than the captive. There are two solutions to this issue, in which the gas of the captive plants will be cut or they will have to be given LNG rates.

Sources in the Ministry of Energy say that there are objections to Capto Power Industry moving to the national grid. According to Capto Industry, moving to the national grid will not provide uninterrupted power, but in the event of a transfer to the national grid, the Power Division is ready to sign an uninterrupted power agreement with them. 

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It should be noted that in the past, due to the lack of stable and consistent supply of electricity through the grid, the government had allowed large industries to install captive power plants. Captive power units are small power plants installed for industrial and commercial purposes, which are often not connected to the grid