PM constitutes committee for transferring DISCOs to provinces

DISCOs and thermal power plants caused national kitty a loss of Rs 292 b during FY22 alone

ISLAMABAD: The government is mulling over the transfer of power distribution companies (DISCOs) to provincial governments for which Prime Minister Shehbaz Sharif has constituted an 11-member committee.

According to sources, the committee which will present its recommendations within 10 days. 

The committee comprises Khawaja Muhammad Asif,  Minister for Defence (Chair), Khurram Dastgir Khan, Minister for Power, Syed Naveed Qamar, Minister for Commerce, Musadik Masood Malik, Minister of State for Petroleum, provincial chief ministers and ministers nominated by CMs, Dr. Muhammad Jehanzeb Khan, Special Assistant to the Prime Minister on Government Effectiveness, Finance Secretary, Secretary Power (Secretary of the Committee), Secretary Privatization Commission, Secretary Law & Justice, Provincial Chief Secretaries. 

The committee may co-opt member(s) from regulatory bodies such as the National Electric Power Regulatory Authority (NEPRA), Securities & Exchange Commission of Pakistan (SECP), Competition Commission of Pakistan (CCP) etc. for input on any regulatory aspect if required,” sources said..

Sharing details of the Terms of Reference (ToRs) of the committee, sources said that it shall examine the current constitutional framework for the transfer from federal government to respective provincial governments. It shall also chalk-out the list of legal requirements that have to be complied, and if needed, suggest a legal framework specific for the purpose. 

Likewise, the committee shall examine requirements of NEPRA with regard to the change of ownership of its licensees and the steps involved therein as also examine regulatory requirements of other regulators including the SECP, SBP, and CCP and outline the compliances required for the transfer of ownership of equity.

It shall draft intent, principles and the scope of the framework agreement to be signed between the federal and provincial governments regarding the mechanism for the transfer. 

Similarly, it shall recommend the principles and parameters of transfer through an agreed transitional plan eventually leading to full provincial responsibility for the sustainable financial functioning of the DISCOs.

Sources also revealed that Dr Syed Tauqir Shah, Principal Secretary to the Prime Minister has informed the secretary power and all concerned about the development in a letter dated 17th March 2023.

Earlier, NEPRA, in its performance evaluation report of the DISCOs and Thermal Power Plants for FY 2021-22, had declared that existing DISCOs set up would not be able to deliver under the given circumstances. The authority had recommended structural changes such as the closure of PPMC, provincialisation, privatisation, bifurcation of large DISCOs, and a reduction of the union’s influence.

According to NEPRA’s performance evaluation report of DISCOs and Thermal Power Plants for FY22, a loss of Rs 292 billion during was caused to the national exchequer on account of T&D losses and less recoveries.

The authority said that the number of fatalities both for employees and public occurred in all distribution companies were 196 which is around 11 percent more than the previous year. 

The highest number of deaths occurred in PESCO (39) followed by HESCO (35), IESCO (27) and K-Electric (27) during FY 2021-22. Further it is observed that most of the fatalities of these distribution companies pertain to the general public. Similarly, the lowest number of deaths occurred in FESCO followed by MEPCO and QESCO.

NEPRA has concluded that the performance of DISCOs throughout this period remained below par and power sector reforms could not be achieved.

Ahmad Ahmadani
Ahmad Ahmadani
The author is a an investigative journalist at Profit. He can be reached at [email protected].

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