FESCO, GEPCO and IESCO are set to enter the privatisation process in the first quarter of 2027, while the government prepares a wider overhaul of the electricity distribution sector.
The federal government is planning to privatise three major power distribution companies (DISCOs) during the first quarter of 2027 as part of its broader strategy to reform Pakistan’s electricity sector and attract private investment.
Prime Minister’s Adviser on Privatisation and Chairman of the Privatisation Commission Muhammad Ali confirmed that the companies included in the initial phase are Faisalabad Electric Supply Company (FESCO), Gujranwala Electric Power Company (GEPCO) and Islamabad Electric Supply Company (IESCO).
Speaking in an interview on Saturday, Muhammad Ali said the due diligence process for all three companies was already underway. However, prospective investors had requested additional time to examine the financial and operational complexities involved in the transactions.
The government had initially aimed to conduct bidding in December 2026, but the schedule could face a slight delay, shifting the expected timeline to January-March 2027.
More DISCOs Included in Privatisation Plan
The privatisation programme will gradually expand to other electricity distribution companies. Work has already started on Hyderabad and Sukkur DISCOs, with their transactions targeted for completion in the second quarter of 2027.
Meanwhile, Lahore, Multan, Peshawar and Hazara electricity distribution companies are expected to enter the process during the second half of 2027.
Muhammad Ali described electricity sector restructuring as a matter of national importance, highlighting how expensive power, distribution losses and inefficiencies were affecting industrial competitiveness, exports and economic growth.
Performance-Based Reforms for Private Investors
The government plans to introduce performance-based requirements for new investors, focusing on smart meters, modern technology, improved bill recovery, reduced electricity losses and uninterrupted supply.
Investors failing to achieve agreed performance targets could face financial penalties, while improvements in efficiency would be rewarded. Consumers would also receive a share of the benefits generated through better operations.
The Privatisation Commission has prepared a comprehensive reform framework covering electricity tariffs, investment plans, business operations and market competition. The proposals are expected to be presented publicly by mid-November following consultations.
Employee Protection and Wider Privatisation Agenda
The proposed reforms also include gradually replacing the uniform electricity tariff with a competitive supplier system while maintaining a supplier of last resort.
Muhammad Ali said employees of DISCOs would receive protection during the transition, including a specified period in which investors would not be permitted to make adverse employment changes.
The government is also examining the privatisation of Pakistan State Oil (PSO), Sui Southern Gas Company and Sui Northern Gas Pipelines Limited as part of its wider economic restructuring programme.