The Cabinet Committee on Energy approved the establishment of an independent multiplayer market for power generation and purchase on Wednesday, aiming to foster competition and gradually phase out the government’s role as the sole buyer of electricity.
During the meeting, chaired by Prime Minister Shehbaz Sharif, the committee gave its principal approval for the creation of an Independent System and Market Operator (ISMO). This decision will later be ratified by the federal cabinet and registered with the Securities and Exchange Commission of Pakistan under the Companies Act 2017, according to a press release from the PM Office.
The ISMO is designed to transition the electricity market into a transparent, competitive environment, allowing power consumers to buy electricity from suppliers other than power distribution companies. It also aims to support long-term planning for low-cost electricity production and transmission, ultimately reducing power prices and addressing the circular debt issue.
The ISMO board will include experts from the power sector to guide these reforms.
During the meeting, participants were briefed on the circular debt in the power sector. Prime Minister Shehbaz Sharif emphasized the importance of urgent reforms in the power sector and directed swift action to curb power theft and reduce losses.
He also called for disciplinary measures against distribution company employees involved in electricity theft and stressed the use of modern technology to implement reforms and tackle theft.
Federal ministers Muhammad Aurangzeb, Ahsan Iqbal, Ahad Khan Cheema, Sardar Awais Ahmed Leghari, Dr Musaddik Malik, Minister of State Ali Pervaiz Malik, and other committee members attended the meeting.
