Pakistan to sell three power distributors in first quarter of 2027
Pakistan plans to privatise three electricity distribution companies in the first quarter of 2027, the prime minister's adviser on privatisation said, pushing back a December bidding target after potential investors asked for more time to weigh the transactions. Faisalabad Electric Supply Company, Gujranwala Electric Power Company and Islamabad Electric Supply Company are the first three in line, with due diligence already under way, Muhammad Ali, who also chairs the Privatisation Commission, said in an interview.
The programme then widens: Hyderabad and Sukkur are targeted for the second quarter of 2027, and Lahore, Multan, Peshawar and Hazara for the second half of the year. Ali framed the sell-off as a national security matter, arguing that high energy costs are eroding industrial competitiveness, exports and growth, and that tariffs must come down and competition be introduced so consumers and factories do not abandon the national grid.
Investors have raised concerns about regulatory uncertainty, tariff revisions and the protection of long-term investments, drawing on the experience of K-Electric, Ali acknowledged. The government is preparing safeguards, including finalising investment plans and multi-year tariffs before bidding, and will require buyers to cut losses and lift recoveries through smart metering and better load management, with penalties for missed benchmarks and rewards for efficiency gains shared with consumers.
A reform paper covering tariffs, investment plans and a competitive electricity market is ready, and Ali said the proposals would be made public by mid-November after consultations with institutions, the prime minister and the steering committee. The plan envisages a gradual move away from the uniform tariff towards competing suppliers, with a supplier of last resort retained for those who cannot access them. Employees would get a protected period during which investors could not take adverse action or change terms of employment.
Beyond the Discos, Ali said the government is examining the privatisation of Pakistan State Oil, Sui Southern Gas Company and Sui Northern Gas Pipelines Limited, with PSO's strategic activities potentially staying under state control.
