S4 Ep48: The high price of Pakistan’s polluting power contracts
VoxDev Development Economics
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Power Purchase Agreements in Pakistan: A Deep Dive
This chapter explores the complexities and implications of power purchase agreements (PPAs) in Pakistan, focusing on their cost-plus structure and long duration that shifts risk from private producers to the public sector. It highlights the challenges of analyzing these opaque contracts, the significant financial burdens they impose on citizens, and the lack of transparency surrounding energy procurement. The discussion emphasizes the detrimental effects of fixed payments to power generators, which lead to inefficiencies and high returns for private firms, raising questions about the fairness and accountability of the system.
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