Privatisation of three DISCOs on track, approval to be sought from CCoP

The process for privatisation of three power distribution companies (DISCOs) — Islamabad Electric Supply Company (IESCO), Gujranwala Electric Power Company (GEPCO), and Faisalabad Electric Supply Company (FESCO) — is progressing, with the Financial Advisor (FA) tasked to structure the transactions. 

BR reported that the Privatisation Commission (PC) will seek approval from the Cabinet Committee on Privatisation (CCoP) before taking the transactions to market. This follows consultations with the Power Division and the World Bank on structuring the Request for Proposal (RFP) for hiring the FA.

According to sources, the Request for Proposal, which outlines the scope of work and evaluation criteria for private-sector participation (PSP) in the three DISCOs, has been shared with pre-qualified financial advisors. The hiring process is underway.

Prime Minister Shehbaz Sharif chaired a meeting on December 27, 2024, to review DISCO performance and the progress of their privatisation. The World Bank has finalised its report on the proposed privatisation and shared it with relevant stakeholders, including the Power Division, Central Power Purchasing Agency (CPPA-G), and NEPRA.

The Privatisation Commission is reviewing the World Bank’s recommendations, particularly the completion of prior conditions (CPs), which are expected to be implemented by January 31, 2025. The FA, upon completion of due diligence, will finalize the transaction structure based on the status of completed tasks and propose any required adjustments.

Additionally, the Special Investment Facilitation Council (SIFC) has directed the Power Division to complete nine prior actions aligned with World Bank deliverables by January 31, 2025. The Privatisation Division has been tasked with expediting the hiring of the FA for the first phase and issuing the RFP. A detailed timeline with milestones will be presented to SIFC by January 15, 2025.

As part of the process, eligibility criteria and investor qualification rules will be reviewed based on feedback from prospective investors following market sounding. The Power Division has also been instructed to finalize the Terms of Reference (ToRs) for Human Resource and communication firms involved in the privatisation process.