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Tanzania: IPTL back in picture, seeks extended license to operate

IPTL entered into the PPA with the Tanzania Electricity Supply Company (TANESCO) to generate electricity in 1996, and was granted the licence the same year. But the license has not been operational since being subjected to a Commercial Operational Date (COD) which started in 2002 and is supposed to end next month.

Tanzania: IPTL back in picture, seeks extended license to operate

IPTL entered into the PPA with the Tanzania Electricity Supply Company (TANESCO) to generate electricity in 1996, and was granted the licence the same year. But the license has not been operational since being subjected to a Commercial Operational Date (COD) which started in 2002 and is supposed to end next month.

08 June 2017 Thursday 10:01
Tanzania: IPTL back in picture, seeks extended license to operate

INDEPENDENT Power Tanzania Limited (IPTL) has applied to the Energy and Water Utilities Regulatory Authority (EWURA) for an extension of its electricity generation licence in line with its existing power purchasing agreement (PPA) with the government.

IPTL entered into the PPA with the Tanzania Electricity Supply Company (TANESCO) to generate electricity in 1996, and was granted the licence the same year. But the license has not been operational since being subjected to a Commercial Operational Date (COD) which started in 2002 and is supposed to end next month.

In a public notice yesterday, EWURA said  it was seeking opinions and comments from the members of the public, as required by law, before making a decision on whether to extend IPTL’s license or not.

The new licence, if granted, will last for 55 months from July 16 this year to January15, 2022, according to the regulator’s notice.

It indicated that any objection or comment on the matter should be submitted in writing to EWURA by June 30.The latest IPTL licence application is likely to reignite a once hot public debate over controversial payments of over $122 million (201 billion/-) from the TANESCO-IPTL escrow account to businessman Harbinder Singh Sethi’s Pan Africa Power Solutions Tanzania Limited (PAP) in 2013.

The money was being held in the Bank of Tanzania (BoT) account established to receive all payments pending arbitration by an international tribunal of a dispute between TANESCO and IPTL over capacity and energy charges.The inexplicable payments to PAP, made before the dispute had been resolved, triggered a major national corruption scandal which ultimately led to the resignations of at least three senior ministers in then president Jakaya Kikwete's government.

A number of other senior government officials were also charged with corruption over the scam.

PAP is the company that subsequently acquired IPTL by using the same escrow funds, in a deal that raised many questions among legal experts. The company is said to have bought out VIP Engineering and Marketing Ltd, the Tanzanian company that originally owned 30 per cent shares in IPTL.

Contacted for comment on the latest notice, EWURA head of communications Titus Kaguo explained that the regulatory body had not been established when IPTL was first granted an electricity generation licence in 1996.“But this time the licence has to be issued by the regulator, which in turn banks on opinions from members of the public,” Kaguo said.

The Guardian

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