Nepra grants power distribution licence to DESCO Karachi

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has granted electricity distribution and supply licences to DHA Energy Supply Company (Private) Limited (DESCO), Karachi, authorising it to operate as a Supplier of Last Resort (SoLR) for its service territory in DHA City Karachi (DHACK).

According to DESCO’s distribution licence, the company will engage in the distribution of electric power business in its Service Territory on a non-exclusive basis, subject to and in accordance with the terms and conditions of this licence.

The licence, issued under the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997, will be effective between October 1, 2026 and September 30, 2046, marking a 20-year operational period for the company.

The entry of DESCO is expected to affect the business of K-Electric (KE) as the residents of DHA were considered as good paying consumers as compared to trouble making parts of Karachi.

The approval comes as part of broader power sector reforms introduced through amendments to the Nepra Act, which aim to liberalise the electricity market by separating supply and distribution functions and encouraging multiple licensees in the sector.

Nepra noted that DESCO demonstrated adequate financial and technical capacity, having already developed key infrastructure in DHA City Karachi, including grid stations, transmission lines, and a distribution network.

Currently, DHACK receives electricity through K-Electric under an existing arrangement that will expire on September 30, 2026. Following this, DESCO will take over the responsibility of supplying electricity to consumers in the area.

As a Supplier of Last Resort, DESCO will be obligated to provide uninterrupted power supply to all eligible consumers within its territory on a non-discriminatory basis, including those affected by defaults of competitive suppliers.

The regulator has directed the company to comply strictly with all applicable laws, including tariff determination by Nepra, procurement regulations, and performance standards. The company must also submit its tariff petition within 90 days if not already determined at the time of licence issuance.

Nepra further emphasised that the licence is non-exclusive, allowing other competitive suppliers to operate within the same service territory in line with the evolving competitive electricity market framework.

The decision is seen as a significant step toward restructuring Pakistan’s power sector, promoting competition, and improving service delivery in urban energy markets.

Copyright Business Recorder, 2026