The Multan Electric Power Company (Mepco) has proposed a Rs119 billion investment plan spanning the fiscal years 2025-26 to 2029-30, aiming to upgrade its power infrastructure. However, the plan faces obstacles, as Mepco struggles with financial inefficiencies, including poor bill recovery and excessive line losses, which have led to a Rs41.8 billion revenue shortfall.
During a public hearing at the National Electric Power Regulatory Authority (Nepra) headquarters, concerns were raised over Mepco’s ability to execute the investment plan effectively. The power utility intends to fund 83% of the projects through internal resources and secure the remaining 13% via debt.
However, Nepra pointed out that Mepco had only utilised 60% of its previous investment allocations and failed to achieve its transmission and distribution (T&D) loss reduction targets.
Instead of maintaining losses at the prescribed 11.83%, Mepco recorded a higher rate of 15.18%, causing a financial impact of Rs22.6 billion.
Additionally, its bill recovery ratio for the fiscal year 2024 stood at 97.2%, leading to a further loss of Rs19.2 billion. Nepra also highlighted technical deficiencies, including low-voltage issues at 132-kilovolt grids and 11kV feeders.
Data presented at the hearing revealed that eight transmission lines and 12 power transformers in key districts, such as Arifwala, Sahiwal, DG Khan, Rahim Yar Khan, Vehari, and Khanewal, were overloaded. Furthermore, 202 feeders were found to be overburdened, with 102 feeders suffering losses exceeding 15%.
Given these financial and operational setbacks, Nepra questioned the necessity of Mepco’s proposed investment plan, particularly as electricity demand has declined.
The regulator urged Mepco to rationalise its spending, prioritise consumer relief, and focus on completing previously approved projects to prevent further cost burdens on consumers.
