Islamabad, March 9, 2025 – A recent study by the Pakistan Institute of Development Economics (PIDE) has emphasized the urgent need to adopt smart meters to tackle persistent issues in electricity billing and losses.
The research highlights how outdated infrastructure and manual billing systems have contributed to inefficiencies in Pakistan’s power sector.
The PIDE, under its Research for Social Transformation & Advancement (RASTA) program, underscores that modernizing the billing system is critical to reforming the struggling power sector. For nearly two decades, reliance on manual billing has led to substantial financial deficits, worsened by rampant electricity theft and poor revenue recovery.
“Power distribution companies (DISCOs) struggle with revenue collection, while consumers frequently face inaccurate billing. A shift to Automated Metering Infrastructure (AMI) offers a transparent, data-driven solution, ensuring efficiency and accuracy in electricity management,” the PIDE report stated.
Call for Urgent Implementation
PIDE Vice Chancellor Dr. Nadeem Javaid stressed the necessity of this transition, stating, “Our electricity billing system’s inefficiencies are a major cause of financial losses and consumer dissatisfaction. Smart meters provide a sustainable solution that minimizes theft, enhances billing accuracy, and empowers consumers to monitor their electricity consumption more effectively.”
Key Findings and Benefits
The study, authored by Afia Malik, Tehmina Asad, and Ghulam Mustafa, detailed the advantages of transitioning to smart meters. A nationwide survey across major cities—including Rawalpindi, Islamabad, Lahore, Multan, Faisalabad, and Sukkur—showed that 79% of respondents were willing to adopt smart meters, even if they had to bear the initial cost. The findings suggest that households using smart meters could reduce their electricity bills by up to 17%, while DISCOs could enhance revenue collection.
Case studies reinforce this impact, with LESCO projected to save Rs960 million from FY2016-17 to FY2023-24 on three high-loss feeders, and MEPCO generating an additional Rs2.2 billion in revenue within 11 months after installing 150,000 smart meters. Internationally, Ghana saw a 13.2% rise in reported electricity consumption after deploying smart prepaid meters, revealing previously undetected electricity theft.
Challenges and Recommendations
While the advantages of smart meters are clear, PIDE stresses that successful implementation requires strategic execution. A survey of 800 consumers from LESCO and MEPCO highlighted that consumer awareness and engagement are crucial for adoption. To facilitate this transition, the report recommends:
• Consumer education programs to build trust and understanding of smart meters.
• Flexible payment options, allowing consumers to pay in installments through electricity bills.
• Development of a competitive smart meter market to lower costs through increased industry competition.
Future Outlook
“Beyond financial efficiency, smart meters can facilitate Pakistan’s transition to a more sustainable energy system. Their integration with mobile applications and smart grids can optimize electricity distribution and encourage renewable energy adoption,” the PIDE report noted. However, achieving these benefits requires strong government support and policy alignment.
As countries worldwide embrace digital advancements in utility management, PIDE urges Pakistan to accelerate its modernization efforts. “Smart meters offer a pathway to transparency, efficiency, and financial sustainability, but their success depends on collaboration between policymakers, DISCOs, and consumers,” the study concluded.