Iesco, Fesco and Gepco set for sell-off by Dec-end
This was stated by an official of the Power Division in the National Assembly Standing Committee on Economic Affairs' meeting held under the chairmanship of Muhammad Atif Khan.
Additional Secretary Power Division Mehfooz Bhatti, in his presentation, told the committee that along with Privatisation Commission, the Power Division is working on the privatisation of all 10 Discos.
He said that the privatisation process of Islamabad Electric Supply Company (Iesco), Gujranwala Electric Power Company (Gepco) and Faisalabad Electric Supply Company (Fesco) is already in advance stage.
'The due diligence process of these three Discos is in final stage and Financial Advisor has also been hired,' he said.
The official said as per his information, the Privatisation Commission is working on the financial structure and by December this year, Expressions of Interest (EOIs) would be invited and terms and conditions of sale purchase agreement will also be finalised.
Chairman Committee Atif Khan said that no one is stopping the government from privatising the Discos but it does not mean hiring in these Discos should be stopped.
He said in his constituency for hundreds of kilometers there is only one lineman and because of this people were facing a lot of hardship in getting their complaints addressed.
The Power Division official clarified that their ministry did not stop any Disco from hiring necessary staff.
MNA Sher Ali Arbab said that as per his knowledge there are 80,000 vacancies in all 10 Discos but Prime Minister Shehbaz Sharif has given approval to hire only 20,000-25,000 personnel to keep things afloat.
Members, unanimously, expressed concern over the methodology that exclusively targets Discos with minimal transmission and distribution losses for privatisation.
The committee emphasised that by limiting privatisation to only the most efficient utilities, the government would be compelled to retain chronically underperforming Discos, thereby, exacerbating existing operational challenges and making their eventual privatisation virtually unattainable.
The Power Division official informed the committee that their current installed capacity is 39,952 MW that includes 46 percent from clean energy and 54 percent from fossil.
The power sector informed that there is overreliance on fossil than clean energy.
The Power Division presented a comprehensive overview of Pakistan's current power generation capacity to the Standing Committee, reporting a total installed capacity of 39,952 MW.
The energy mix analysis revealed a concerning imbalance, with fossil fuel-based generation accounting for 54 percent compared to just 46 percent from clean energy sources.
The committee was informed that Pakistan's power sector currently faces a significant surplus of approximately 7,000 to 8,000 MW in electricity generation capacity.
Members expressed serious concern over the substantial financial burden imposed by capacity payments for this unused electricity, which continues to strain the national exchequer despite serving no practical purpose.
The committee members raised serious concerns regarding the inequitable distribution of development projects and budget allocations for Khyber Pakhtunkhwa in the proposed federal budget for 2025-26.
The committee noted with concern that while KP has a substantially larger population than Gilgit-Baltistan (GB), both regions have been allotted only two new projects each, reflecting an unjust disparity.
Furthermore, the budgetary allocations for development projects across provinces revealed that Balochistan receiving Rs209.6 billion, Punjab Rs76.6 billion, Sindh Rs145.9 billion, and KP Rs30.843 billion.
The Economic Affairs Division (EAD) informed the committee that it has filed appeals and interim relief applications, with hearings ongoing and the next scheduled for September 2025.
Meanwhile, the EAD has sought the federal cabinet's in-principle approval for a new legislative framework, the 'Foreign Contributions (NGOs and NPOs) Regulation Act, 2025,' to address the legal gaps.
Copyright Business Recorder, 2025
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
2 hours ago
- Express Tribune
NEPRA mulls Rs1.80/unit power tariff cut
The Power Division has urged Nepra to align KE's tariff structure with national standards to ensure fairness, transparency and affordability. photo: file The National Electric Power Regulatory Authority (NEPRA) has indicated a possible reduction of Rs1.80 per unit in electricity prices under the Quarterly Tariff Adjustment (QTA) for the quarter ending June 2025. The proposed relief, if approved, could provide consumers across Pakistan with financial relief amounting to Rs53.393 billion. The proposal was discussed during a public hearing held at NEPRA headquarters on Monday, where representatives from the Central Power Purchasing Agency (CPPA-G), distribution companies (DISCOs), business community, media, and general consumers presented their views. The request was submitted by CPPA-G on behalf of ex-WAPDA DISCOs to refund the surplus funds under QTA for the April-June 2025 quarter. NEPRA was informed that the main driver of the proposed relief is a significant decrease in capacity payments by Rs53.714 billion. Additionally, improved efficiency in transmission and distribution (T&D) led to a further reduction of Rs662 million. However, these savings were partially offset by slight increases in Operation & Maintenance (O&M) costs and Use of System Charges and Market Operation Fees (UoSC & MoF), which went up by Rs182 million and Rs804 million respectively. During the proceedings, NEPRA officials were also briefed on the status of the power sector's circular debt. According to Power Division officials, the circular debt has declined by Rs780 billion over the past fiscal year, falling from Rs2,300 billion to Rs1,600 billion. This improvement was attributed to better DISCO performance, which contributed to Rs200 billion in savings. However, the closure of the Neelum-Jhelum Hydropower Plant adversely impacted the sector by Rs18 billion. Officials highlighted that electricity consumption among DISCOs increased by an average of 31%, with the exception of Quetta Electric Supply Company (QESCO), which reported a decline in sales. NEPRA officials raised concerns over the reported growth in industrial consumption, but none of the DISCOs' CEOs could provide satisfactory explanations. The government, officials said, is currently working on reforms to both direct and cross subsidies. They also clarified that the Rs1,275 billion raised through bank loans to manage power sector liabilities would not require any separate surcharge for repayment. If NEPRA approves the proposed adjustment, the relief will be applicable to all DISCO consumers, including those served by K-Electric, except lifeline users, prepaid meter holders, and electric vehicle (EV) charging stations. This aligns with the federal government's policy of maintaining a uniform power tariff nationwide. Among the DISCOs, Faisalabad Electric Supply Company (FESCO), Lahore Electric Supply Company (LESCO), and Multan Electric Power Company (MEPCO) requested the highest refunds at Rs15.03 billion, Rs12.64 billion, and Rs8.47 billion, respectively. In contrast, QESCO sought a positive adjustment of Rs3.594 billion due to higher capacity payments and operational costs, reducing the total refund amount from Rs56.987 billion to Rs53.393 billion. For context, NEPRA had allowed a recovery of Rs1.7432 per unit, or Rs43.23 billion, in QTA during the same quarter of FY2023-24. NEPRA stated that a final decision will be issued after further scrutiny of the data submitted. If approved, the adjustment would provide much-needed relief to consumers struggling with high inflation and increased cost of living.
Business Recorder
19 hours ago
- Business Recorder
G2G agreement: Pakistan govt plans to offer solar projects to Saudi firm
ISLAMABAD: Pakistan government has reportedly included two large-scale solar power projects, totalling 2,800 MW, in the Indicative Generation Capacity Expansion Plan (IGCEP) 2025-35, which may be offered to Saudi energy company M/s ACWA Power under a proposed Government-to-Government (G2G) agreement. According to sources, the National Grid Company of Pakistan Limited (NGC), in a letter titled 'Land Acquisition for Solar Power Projects at Layyah, Jhang and Muzaffargarh', informed the Private Power and Infrastructure Board (PPIB) about the inclusion of these projects in the IGCEP. Shah Jahan Mirza, Managing Director of PPIB, has conveyed to the Power Division that the draft IGCEP—currently under finalization—includes various scenario analyses by the System Operator (ISMO). Among them are two specific solar PV development scenarios proposing 1,000 MW and 1,800 MW capacity additions, earmarked for potential development by ACWA Power. Saudi firm keen to invest in renewable energy sector However, he emphasized that the offer to the Saudi side would depend on the approval of these scenarios by NEPRA. Mirza also advised the Power Division not to de-notify the land identified for these solar PV projects until the IGCEP is formally approved. The project's future had earlier appeared uncertain. In November 2023, Pakistan's Ambassador to Saudi Arabia reported that ACWA Power had declined to sign any agreement with Islamabad, citing security concerns. However, a shift in momentum was seen after a delegation of Saudi investors—including ACWA representatives—visited Pakistan and held talks with the Special Investment Facilitation Council (SIFC). Since then, Pakistan's embassy in Riyadh has remained in contact with the company. Despite renewed interest, hurdles remain. Saudi authorities have expressed concerns over the treatment of M/s Al-Jomaih, a Saudi investor involved with K-Electric. These concerns, officials said, have made Saudi investors cautious about engaging in new ventures in Pakistan. The Al-Jomaih issue is now being handled by Deputy Prime Minister Senator Ishaq Dar. The inclusion of these solar projects in the IGCEP signals the government's ongoing efforts to diversify its energy mix and attract foreign investment in renewable energy—though political and regulatory assurances remain critical to securing such high-value deals, the sources said. Copyright Business Recorder, 2025
Business Recorder
a day ago
- Business Recorder
G2G agreement: Govt plans to offer solar projects to Saudi firm
ISLAMABAD: The government has reportedly included two large-scale solar power projects, totalling 2,800 MW, in the Indicative Generation Capacity Expansion Plan (IGCEP) 2025-35, which may be offered to Saudi energy company M/s ACWA Power under a proposed Government-to-Government (G2G) agreement. According to sources, the National Grid Company of Pakistan Limited (NGC), in a letter titled 'Land Acquisition for Solar Power Projects at Layyah, Jhang and Muzaffargarh', informed the Private Power and Infrastructure Board (PPIB) about the inclusion of these projects in the IGCEP. Shah Jahan Mirza, Managing Director of PPIB, has conveyed to the Power Division that the draft IGCEP—currently under finalization—includes various scenario analyses by the System Operator (ISMO). Among them are two specific solar PV development scenarios proposing 1,000 MW and 1,800 MW capacity additions, earmarked for potential development by ACWA Power. Saudi firm keen to invest in renewable energy sector However, he emphasized that the offer to the Saudi side would depend on the approval of these scenarios by NEPRA. Mirza also advised the Power Division not to de-notify the land identified for these solar PV projects until the IGCEP is formally approved. The project's future had earlier appeared uncertain. In November 2023, Pakistan's Ambassador to Saudi Arabia reported that ACWA Power had declined to sign any agreement with Islamabad, citing security concerns. However, a shift in momentum was seen after a delegation of Saudi investors—including ACWA representatives—visited Pakistan and held talks with the Special Investment Facilitation Council (SIFC). Since then, Pakistan's embassy in Riyadh has remained in contact with the company. Despite renewed interest, hurdles remain. Saudi authorities have expressed concerns over the treatment of M/s Al-Jomaih, a Saudi investor involved with K-Electric. These concerns, officials said, have made Saudi investors cautious about engaging in new ventures in Pakistan. The Al-Jomaih issue is now being handled by Deputy Prime Minister Senator Ishaq Dar. The inclusion of these solar projects in the IGCEP signals the government's ongoing efforts to diversify its energy mix and attract foreign investment in renewable energy—though political and regulatory assurances remain critical to securing such high-value deals, the sources said. Copyright Business Recorder, 2025
