ISLAMABAD: The Auditor General of Pakistan (AGP) has accused Gujranwala Electric Power Company (GEPCO) of applying excessive load factors to artificially achieve line-loss reduction targets and increase subsidy claims during FY 2024–25.
According to the NEPRA Consumer Service Manual (CSM) issued on January 13, 2021, the permissible load factor for different categories of connections ranges between 15 percent and 70 percent, as prescribed by the regulator.
Under Para 8.2.10 of the NEPRA Consumer Service Manual, if a consumer extends load beyond the sanctioned limit, the utility is required to issue a notice directing the consumer to apply for load extension within 15 days. If the consumer fails to comply and complete the required formalities, the DISCO is authorized to disconnect the electricity supply.
During the audit of GEPCO for FY 2024–25, it was observed that in 49,769 consumer cases across various tariff categories, a total of 646.98 million units were billed on running metered connections by applying load factors exceeding 100 percent, whereas the CSM prescribes specific load factor limits for each consumer category.
Audit scrutiny revealed that 496.55 million units were billed in excess of NEPRA’s prescribed load factors under categories including government, AJK feeders (heavily government-subsidized), commercial, industrial, and tubewell connections, indicating that consumers had utilized extended loads without proper regularization by the management.
Notably, 225.14 million units (45.34 percent) of the total units were billed to 11 AJK feeders, 15.69 million units were charged to 915 governments’ (A-3 tariff) consumers, while 2.29 million units were billed to public lighting connections due to excessive load factors.
Since AJK feeders are subsidized by the Government of Pakistan, and the A-3 government connections and public lighting charges are also paid by the government, the financial burden ultimately falls on the public exchequer.
“This scenario indicates that excessive load factors were applied to artificially achieve line-loss reduction targets and increase subsidy claims. As a result of this inaccurate charging, 496.55 million units were billed to consumers during FY 2024–25,” the audit report stated.
According to the audit, the excessive load factor appears to have resulted from factors such as accumulated meter readings, use of extended or unsanctioned load, and lack of system checks in the billing process.
The report further noted that weak internal controls over load verification, inadequate supervision of metering and billing processes, and ineffective enforcement of CSM provisions regarding load regularization contributed to the irregular application of load factors.
Audit maintained that non-adherence to the provisions of the NEPRA Consumer Service Manual resulted in the application of abnormal load factors beyond the permissible limits during FY 2024–25.
The matter was taken up with GEPCO management in November 2025 and subsequently reported to the Power Division in December 2025.
In its response, the management argued that the audit observation regarding units charged above 100 percent load factor was not valid, stating that Annexure-V of the NEPRA CSM applies only to detection bills related to electricity theft or illegal abstraction, and not to regular billing under Chapter 6.
The management further stated that 225.14 million units relate to 11 AJK bulk supply connections, which are government-subsidized and fall outside retail load factor assessment. It added that field verification is ongoing and, where unauthorized load extensions are identified, notices for regularization are being issued in accordance with NEPRA rules.
However, the audit rejected the explanation, stating that the Consumer Service Manual defines load factor as the ratio of average load over a designated period to the peak load during that period, reflecting the average consumption of consumers in relation to their sanctioned load.
The audit also pointed out that 11 kV AJK feeders are used for electrification of general consumers, therefore retail load factor limits are applicable to them as well.
The Departmental Accounts Committee (DAC), in its meeting held on May 2–3, 2026, directed GEPCO management to submit detailed justification on a case-to-case basis, including technical reasons and evidence of action taken against over billing.
Audit recommended that the management investigate all cases where billing was made by applying load factors exceeding 100 percent and regularize the extended loads of such consumers in accordance with the provisions of the Consumer Service Manual.
Copyright Business Recorder, 2026
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