ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has grilled Power Division for its failure to control Transmission & Distribution (T&D) losses in the power Distribution Companies (Discos) as cumulative losses till March 2025 stood at Rs 143 billion which are above monthly assumptions, well informed sources told Business Recorder.
The Finance Division is also considering deducting federal and provincial governments’ outstanding electricity dues at source before June 30, 2025.
At a recent meeting of the ECC, the Power Division briefed the forum that 11 DISCOs operate under the administrative control of the Power Division and are governed by the provisions of the State-Owned Enterprises (Governance and Operations) Act, 2023 and State-Owned Enterprises (Operations and Management) Policy, 2023. The matters of Board of Directors were also governed under the Act and Policy.
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The Board of Directors of Faisalabad Electric Supply Company (FESCO), Islamabad Electric Supply Company (IESCO), Lahore Electric Supply Company (LESCO), Multan Electric Power Company (MEPCO) and Hazara Electric Supply Company (HAZECO) were constituted on July 24, 2024.
Moreover, the Board of Directors of Gujranwala Electric Power Company (GEPCO), Peshawar Electric Supply Company (PESCO), Quetta Electric Supply Company (QESCO), and Tribal Areas Electric Supply Company (TESCO) were constituted on August 21,2024.
The summary for reconstitution of HESCO and SEPCO Boards with appropriate representation of independent and ex-officio directors as per relevant provisions of State-Owned Enterprises (Governance and Operations) Act, 2023 and State-Owned Enterprises (Operations and Management) Policy, 2023 were submitted to Prime Minister’s Office on August 23, 2024 and September 09, 2024, respectively.
In compliance with the directive issued in the ECC meeting held on November 4, 2024, following were the status update regarding the governance of DISCOS: (i) the Boards of Directors (BoDs) for all DISCOs have been reconstituted, except for SEPCO and HESCO, where the process is in the finalization stage.
The reconstituted Boards are structured to ensure enhanced corporate governance, strategic oversight, and operational efficiency; and (ii) the PPMC has implemented a monthly performance monitoring mechanism for all DISCOs, evaluating key operational, commercial, and financial parameters. This monitoring framework ensures that each DISCO is accountable for its performance and adheres to the sector’s strategic goals.
In line with the National Electricity Policy, strategic roadmaps have been formulated and signed in February 2025 by the respective chairpersons of the BoDs and CEOs of all DISCOs. These roadmaps outline T&D/Aggregate Technical and Commercial (AT&C) loss reduction, bill collection, theft prevention, load-shedding management, consumer services, safety compliance, Supervisory Control and Data Acquisition (SCADA) implementation, Geographic Information System (GIS) mapping, Enterprise Resource Planning (ERP) system automation, computerized energy audits up to the distribution transformer level, and the execution of Service Level Agreement (SLA) & Operation and Maintenance (O&M) frameworks.
The Power Division further briefed the forum that to accomplish these objectives, a structured action matrix had been developed by DISCOS, covering key initiatives such as feeder rehabilitation, distribution transformer addition/augmentation, grid station expansion, capacitor installation, HT and LT line addition, transmission line upgrades, Aerial Bundled (ABC) cable deployment, and Advanced Metering Infrastructure (AMI) meter installation.
In light of directive/decision issued in ECC meeting held on November 4, 2024, the status regarding the governance of all DISCOs whose Boards had been reconstituted with a view to improving the governance of DISCOs was submitted in form of summary to ECC under rule 18(1) read with 23(4) of Rules of Business, 1973.
During the ensuing discussion, the forum was conveyed that the Boards of all DISCOs, except HESCO and SEPCO, had been re-constituted, further informing that with the oversight of Boards, the entities had shown improvement.
The forum was also conveyed that the PPMC, being technical arm of the Division, is regularly monitoring the performance of the distribution companies. It was also noted that the targets assigned to the Power Division regarding reduction in T&D losses have not been met. It was noted with concern that the losses of LESCO had increased, instead, over the year and the forum stressed upon the need for adopting a robust plan to arrest this trend.
The forum was informed that the interventions are being made to improve the operations of entity to reduce the losses.
The forum was informed with reference to QESCO that 70% of the losses are due to agriculture tube wells, and that their solarisation would improve the situation. The Power Division also apprised the forum about the Government Department’s dues of DISCOs to be paid by the Federal and Provincial Government Departments, and sought intervention of the Finance Division for their early clearance.
The forum was informed that the mechanism is in place for at source deduction of the amount, once the liability/amount is reconciled between the Distribution Company and the provincial government.
After detailed discussion, the ECC directed the Power Division to share the reconciled figures of the outstanding electricity dues, to be paid by the Federal and provincial government entities, with the Finance Division for their early settlement clearance.
Copyright Business Recorder, 2025
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