CCoP Approves Restructuring Plan for FESCO, GEPCO and IESCO

The Cabinet Committee on Privatisation (CCoP) has approved a restructuring plan for three major electricity distribution companies — Faisalabad Electric Supply Company (FESCO), Gujranwala Electric Power Company (GEPCO) and Islamabad Electric Supply Company (IESCO).

 

The move is part of the government’s broader efforts to reform the power sector and make distribution companies more financially sustainable, professionally managed, digitally enabled and focused on improving consumer services.

 

Under the approved framework, selected assets, including land, along with certain liabilities such as post-retirement benefits of employees who have already retired and their associated funds, will be transferred to a government-owned Special Purpose Vehicle (SPV). Retirement liabilities of serving employees will remain with the respective DISCOs.

 

The restructuring will also involve netting off inter-governmental receivables and payables to settle outstanding government claims.

 

According to the Privatisation Commission, the restructuring is designed to remain fiscally neutral while improving the value and viability of the companies ahead of potential future transactions.

 

Privatisation Adviser to the Prime Minister Muhammad Ali said consumer interests would remain protected under the existing regulatory framework. Electricity tariffs will continue to be determined through the National Electric Power Regulatory Authority (NEPRA) process and subsequently notified by the government.

 

The reform programme is expected to focus on improving power reliability, operational efficiency and customer service. FESCO, GEPCO and IESCO collectively provide electricity to more than 14 million consumers across major industrial, commercial and urban areas.

 

The government has also stressed that uninterrupted service will remain a priority during the restructuring process, while employee interests will be handled according to applicable laws and transaction arrangements.

 

The CCoP’s approval represents an important step in the government’s broader plan to modernise DISCOs and tackle longstanding financial and operational weaknesses in Pakistan’s electricity distribution sector.