Islamabad — The government plans to privatise three power distribution companies (DISCOs) — the firms that deliver electricity to homes and industry — in the first quarter of 2027, Prime Minister’s Adviser on Privatisation and Privatisation Commission Chairman Muhammad Ali said in an interview on Saturday.
The three utilities named are Faisalabad Electric Supply Company (FESCO), Gujranwala Electric Power Company (GEPCO) and Islamabad Electric Supply Company (IESCO). Due diligence on the transactions is already under way. Potential investors asked for extra time to assess the complex deals, according to a Privatisation Commission press release summarising the interview.
Bidding delayed from December
Authorities had initially hoped to hold bidding in December. Muhammad Ali said that timeline may slip slightly, with the target now set for the first quarter of next year. He framed power-sector reform as a national security issue, arguing that high energy costs were hurting industrial competitiveness, exports and economic growth.
Pakistan, he said, needs lower electricity tariffs and more competition in supply so that households and factories do not leave the national grid. Referring to the experience of Karachi’s K-Electric, he acknowledged investor worries about regulatory uncertainty, tariff revisions and the safety of long-term capital. The government is preparing safeguards, including investment plans and multi-year tariffs, before bidding begins.
Wider DISCO timeline and reform paper
Work has also begun on privatising the Hyderabad and Sukkur distribution companies, with those deals expected in the second quarter of 2027. Lahore, Multan, Peshawar and Hazara distributors remain on the privatisation programme, with completion targeted for the second half of 2027.
The Privatisation Commission has prepared a reform paper on tariff structures, investment plans, business activities and a competitive electricity market. Muhammad Ali said the government intends to share those proposals with the public by mid-November, after consultations with relevant institutions, the prime minister and the Steering Committee.
The package aims to move gradually away from a uniform electricity tariff by allowing competitive suppliers, while keeping a supplier of last resort for customers who cannot reach a competitive offer. Investors would earn returns in Pakistani rupees, not dollars, with returns linked to inflation and set under the capital asset pricing model — a standard method for pricing expected investment returns.
Performance rules and worker protections
Under the plan described by the adviser, privatised DISCOs would have to cut losses, improve bill recoveries, adopt smart metering and other technology, and deliver more reliable supply and load management. Investors who miss performance benchmarks would face penalties; those who raise efficiency and cut losses would be rewarded, with gains shared with consumers.
On staff fears, Muhammad Ali said the government would protect DISCO workers for a defined period during which buyers could not take adverse action or change employment terms. He added that employees would remain essential to running the distribution system after privatisation.
Separately, he said the government is also examining the sale of Pakistan State Oil (PSO), Sui Southern Gas Company and Sui Northern Gas Pipelines Limited, while strategic activities of PSO could stay under state control. The broader privatisation drive, he said, seeks efficiency, investment and fixes for structural problems in key sectors.
Timeline: what has happened so far
- Saturday, 31 October 2026: Muhammad Ali says FESCO, GEPCO and IESCO are targeted for privatisation in Q1 2027; due diligence is under way.
- December 2026 (earlier plan): Bidding for the three DISCOs had been aimed for this month; the adviser now flags a possible slight delay.
- Mid-November 2026 (planned): Reform proposals on tariffs, investment and competition are to be shared with the public after consultations.
- First quarter 2027 (target): Privatisation of FESCO, GEPCO and IESCO.
- Second quarter 2027 (target): Completion of Hyderabad and Sukkur distribution company transactions.
- Second half of 2027 (target): Completion of Lahore, Multan, Peshawar and Hazara distributor processes.
Aasan alfaaz mein
Sarkar Faisalabad, Gujranwala aur Islamabad ke bijli distribution companies ko 2027 ke pehle teen mahine mein private karne ka irada rakh ti hai. Pehle December mein bidding sochi gayi thi, lekin investors ko zyada waqt chahiye tha, is liye timeline thodi peeche ja sakti hai. Bijli ke rates, competition aur grid se logon ke nikalne ka masla is plan ka asl maqsad hai. Mulazimeen ke liye ek muddat tak job terms ki hifazat ka wada kiya gaya hai.
