Islamabad: The Cabinet Committee on Privatisation (CCoP), chaired by the Deputy Prime Minister, has approved the restructuring plan for the first batch of electricity distribution companies (DISCOs).
The plan covers Faisalabad Electric Supply Company (FESCO), Gujranwala Electric Power Company (GEPCO) and Islamabad Electric Supply Company (IESCO).
The decision marks an important step in the government’s wider power-sector reform agenda. It aims to create financially sustainable, professionally managed and digitally enabled distribution companies.
Assets and Liabilities to Be Restructured
Under the approved plan, selected assets and liabilities will move to a Government of Pakistan-owned Special Purpose Vehicle (SPV).
The assets will include all land parcels. The selected liabilities will include post-retirement benefits for employees who have already retired.
A material amount of funds will also form part of the restructuring arrangement. Retirement benefits for current employees will remain with the respective DISCOs.
The government will also net off inter-governmental receivables and payables to settle its receivables.
Focus on Financial Sustainability
The restructuring plan will remain fiscally neutral. The government prepared the plan to protect and enhance the value of its assets.
The arrangement also aims to ensure that the proposed transaction remains financially viable.
The government said consumers, employees, businesses and local communities all have a direct stake in the reforms.
Service continuity will remain a key priority during the restructuring process. The government will address employee interests under applicable laws and transaction arrangements.
It will also keep relevant stakeholders informed as the process moves forward.
Consumers to Remain Protected
Muhammad Ali, Advisor to the Prime Minister on Privatisation, said consumers would remain protected under Pakistan’s regulatory framework.
“Electricity tariffs will continue to be determined through the applicable NEPRA process and notified by the Government,” he said.
He added that the reforms would focus on improving reliability, efficiency and customer service.
More Than 14 Million Consumers
FESCO, GEPCO and IESCO collectively serve more than 14 million consumers.
Their service areas include major industrial, commercial and urban centres across Pakistan.
Improving the performance of these companies remains important for the government’s efforts to reduce power-sector costs and provide more competitive electricity services.
Key Step in Power-Sector Reform
The CCoP’s approval marks a major step in the restructuring of Pakistan’s power distribution sector.
The government now plans to move beyond legacy financial and operational challenges. It aims to build modern, accountable and consumer-focused electricity distribution companies.
The reforms are expected to improve service quality, strengthen financial performance and support Pakistan’s wider economic growth.
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