ISLAMABAD: The Prime Minister has appointed former Lieutenant General Muhammad Zafar Iqbal (Retd) as Special Assistant to the Prime Minister (SAPM) on Energy, with the status of Minister of State, with immediate effect, placing the head of the National Task Force on Energy in a formal advisory role at the Prime Minister’s Office (PMO).
According to a notification issued by the Prime Minister’s Office on October 13, 2026, the appointment has been made under Rule 4(6) of the Rules of Business, 1973. The notification, bearing No. 3882/APM/2026, states that the Cabinet Division will take further necessary action in connection with the appointment.
The notification was issued by Shakeel Ahmed Mangnejo, Special Secretary to the Prime Minister.
Lt Gen Zafar Iqbal (Retd) headed the National Task Force on Energy tasked with negotiating changes to agreements with Independent Power Producers (IPPs) and government power plants as part of the government’s efforts to reduce electricity costs and address financial pressures in the power sector.
The government has already conferred performance-based rewards on members of the task force for their contribution to power sector reforms.
The task force has claimed significant achievements, including the termination of contracts with six IPPs, renegotiation of tariffs with thermal, bagasse and wind-based power producers, settlement of arbitration awards, and measures to reduce the circular debt burden.
According to the task force, renegotiated agreements with IPPs are expected to generate estimated savings of Rs4,000 billion over the remaining life of the projects. It has also reported the settlement of arbitration awards between the Government of Pakistan and 12 thermal IPPs, including the recovery of more than Rs30 billion in past excess payments.
Another major initiative involved resetting future Late Payment Interest (LPI) to KIBOR plus one percent across the power and petroleum supply chain. The task force has also claimed the waiver of late payment interest exceeding Rs400 billion as part of the broader restructuring exercise.
The task force further facilitated a Rs1.225 trillion circular debt financing scheme through commercial banks to address outstanding liabilities in the power sector. However, the financing cost is being recovered from consumers of electricity distribution companies (Discos) and K-Electric through a surcharge of Rs3.23 per kilowatt-hour over six years.
According to sources, the Energy Task Force, now shifted to the Prime Minister’s Office, is also dealing with the gas sector’s circular debt, which remains a major financial challenge for the energy chain.
Copyright Business Recorder, 2026
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