Providing people with affordable electricity is the government's top priority, information minister Shibli Faraz said Saturday.
"No attempt has been made in the past to solve the energy sector's problems," Faraz said, addressing a press conference alongside the premier's aide on power Shahzad Qasim, in Islamabad.
He said that if the problems the sector is mired with are not resolved, the country will go through a very difficult time.
Faraz said that the PTI government made Pakistan's energy sector a special area of focus since it came into power. He regretted that owing to expensive deals made in the past, power tariffs have remained high.
He said that the contracts cannot be done away with unilaterally hence, negotiations were held.
"The wrong policies of the past have drowned the country in circular debt," Faraz said, adding that "unplanned power plants were installed in the past".
He said that expensive energy does not only impact household consumers but also affects exports and past policies paid no attention to distribution of electricity and cheap production.
The information minister said Prime Minister Imran Khan a task force was formed which reviewed the deals made during past government tenures.
He said a rising dollar rate made electricity very expensive which is not easy for an economy to bear.
"Our government aims to determine why cost of electricity is so high and every step is being taken to reduce these costs," Faraz said.
According to Radio Pakistan, a basic agreement has been signed with Independent Power Producers as a first major step towards providing cheap electricity to consumers.
"Under the agreement signed with the IPPs, payments will only be made for the electricity acquired and consumed instead of the total installed capacity of a particular power plant," it reported.
Moreover, the plants will now receive equity return in rupees rather than the dollar.
Addressing the briefing, Qasim said under the MoU, "late payment interest will be reduced from 4.5% to 2%".
He said the government aims to finalise the terms of agreement under the MoU signed with IPPs in two-and-a-half years.