Rates by IPPs high, Duma says

By PETER ESILA
STATE Enterprises Minister William Duma says the rates by independent power producers (IPPs) are still high and there is room to negotiate for a better deal for PNG Power Limited (PPL).
Duma said this in Parliament yesterday when responding to Abau MP Sir Puka Temu on the issue of delayed payments to IPPs from PNG Power based on the power purchase agreement (PPA) which was a strain on the already struggling State-owned entity.
“The rates are bit worrying, and therefore puts pressure on PPL,” Sir Puka said.
“I understand that the payments are made on a monthly basis and for one IPP, I think PPL have to pay K14 million per month for one provider, and there are other IPPs in the country.
“Can I suggest to the minister to use a provision of law, called the Fairness of Transaction Act (1993). PNG Power is struggling to meet its responsibilities to IPPs, and therefore there needs to be some review taken.”
However, Duma said there was room to negotiate with IPPs.
“This is something we need to look at very carefully and do everything within our means to get the IPPs to agree with us that they have made money on their investments, it is above the normal rate of investment can provide and they are lucky to be operating in this country, we will deal with this matter,” he said.
The current IPPs in Papua New Guinea are PNG Forest Products Hydro, NiuPower, Dirio Power, New Britain Oil Palm, Posco and Edevu Hydro (PNG Hydro Developments).