Privatization critical for energy sector transformation: PM

ISLAMABAD: Prime Minister Shehbaz Sharif on Monday called for an accelerated privatization of electricity distribution and generation companies to resolve the country’s persistent energy crisis.

The call came during a review meeting on the power sector reforms, where the prime minister emphasized that privatization is crucial for transforming the energy sector into a competitive market, ensuring long-term stability and efficiency.

The meeting, attended by senior government officials and advisors, focused on the progress of ongoing energy sector reforms and discussed the next steps for their implementation.

Energy sector under transformation: SIFC officials

The prime minister was briefed on several initiatives, including the privatization of major electricity transmission companies and the expansion of the national power grid.

According to a statement from the Prime Minister’s Office, the government is moving ahead with the privatization of three key electricity distribution companies – Islamabad Electric Supply Company (IESCO), Faisalabad Electric Supply Company (FESCO), and Gujranwala Electric Power Company (GEPCO).

The officials said that the expressions of interest (EoIs) will be published soon, signaling the next phase of the privatization process.

Prime Minister Sharif also reviewed critical transmission projects, including the 500kV Ghazi Barotha-Faisalabad Transmission Line. Officials indicated that approval for the project’s PC-I is under way, with work expected to begin shortly.

In another major move, Sharif proposed introducing a Battery Energy Storage System through a public-private partnership. This initiative aims to modernize the power sector, improve grid stability, and boost energy efficiency.

The meeting also addressed the transition of the country’s thermal power plants from imported coal to locally sourced Thar coal.

The officials said that the technical feasibility study for this shift has been completed, and work is underway to build a dedicated railway line for transporting Thar coal to power plants. This move is expected to reduce the country’s dependence on expensive imported coal and ease the financial strain on the energy sector.

On a positive note, officials said that a significant reduction in line losses – a long-standing issue in the country’s electricity distribution system.

Finally, the prime minister was briefed on the operationalisation of a competitive electricity market, a key component of the broader power sector reforms.

The officials said that a feasibility study for the Battery Energy Storage System has already been initiated, and the Concept Clearance Proposal has been approved. The meeting was attended by Federal Minister for Finance Mohammad Aurangzeb, Minister for Economic Affairs Ahad Cheema, Minister for Power Division Awais Leghari, and other senior officials.

Copyright Business Recorder, 2025