The Economic Coordination Committee (ECC) of the Cabinet has instructed all ministries and divisions to include a detailed breakdown of expenditures in their proposals when submitting summaries for decision-making. This directive was issued during a recent ECC meeting, where the Power Division presented a summary regarding the Prime Minister’s Fan Replacement Program.
According to media reports, the ECC also expressed dissatisfaction with the National Energy Efficiency and Conservation Authority (NEECA) for failing to initiate the program despite a year-long delay. NEECA, established under the National Energy Efficiency and Conservation Act of 2016, is tasked with driving energy conservation efforts across Pakistan.
The Prime Minister’s Fan Replacement Program, aimed at replacing 88 million inefficient fans in the country, was expected to reduce peak electricity demand by 5,000 megawatts. NEECA designed the program to be a digital credit product, utilising a bill-financing mechanism, with support from the Ministry of Energy, State Bank of Pakistan (SBP), and commercial banks.
The program was structured to be an automated process, integrating consumers, fan manufacturers, DISCOs, and banks on a single digital platform.
The Power Division noted that a budget of Rs. 2 billion was allocated for the program for FY 2024-25, with Rs. 1.5 billion set aside for risk coverage through the SBP guarantee, and Rs. 500 million for program implementation and awareness activities.
However, due to the allocation of funds under the Finance Division’s demand instead of the Power Division’s, the ECC sought approval for a technical supplementary grant of Rs. 106 million.
During the meeting, concerns were raised over the delayed launch of the project, with explanations pointing to unresolved issues between SBP and commercial banks. The delay was also attributed to the need for banks to update their IT infrastructure to accommodate the project.
Despite these challenges, the ECC approved the reallocation of funds and instructed the Finance Division to assist the Power Division in finalizing the project’s modalities with the banks.
The committee also emphasized the importance of providing a clear breakdown of expenditures in all future proposals to facilitate informed decision-making.
