Federal Energy Minister Sardar Owais Ahmed Khan Legari announced on Friday comprehensive reforms in the energy sector in Pakistan, including the privatization of the main assets, the restructuring of the purchase of electricity, and a long -term strategy to reduce electricity prices.
In his speech to a press conference in Islamabad, Legari stated that the government, under the leadership of Prime Minister Sherfins Sharif, is committed to reforming the energy sector through targeted reforms and cost reduction measures. He expressed confidence that the electricity prices will decrease significantly over the three years to the next four with the validity of these reforms.
He revealed that Pakistan is no longer operating under one electricity model, as the government seeks to involve the private sector in purchasing energy and sales. He said: “The CPPA (CPPA) should not remain the only buyer,” adding that the purchases will follow the less cost principles shown in the plan to expand the IGCEP power, which is completed and will be presented soon to the Prime Minister.
The Minister announced plans to privatize many of the assets of the public sector. In the first stage, three distribution companies – Islamabad (IESCO), Gujranwala (Gepco), faisalabad (FESCO) – will be privatized – followed by Lesco (Lesco), Multan (MEPCO), and Hazeco in the second stage. Discos Hyderabad, Sukkur and Peshawar will be presented under a franchise model, while Quetta and Tribal power supply will be improved under government supervision and their management later through contracts.
In addition, the Guddu and Nandipur power plants are prepared for privatization, while the gradual elimination of the ineffective GENCOS is done. The newly established energy planning and management company (PPMC) will act as the political and technical arm of the Energy Department.
Legari highlighted that the government has already achieved savings of 396 billion rupees by ending contracts with ineffective power plants and re -negotiating agreements with independent energy producers (IPPS). He said that these savings will eventually be transferred to consumers through low definitions.
Negotiations with 36 IPPS were concluded, with more ongoing conversations. “If any party refuses to negotiate, the government has the right to request a forensic review,” he warned, adding that one of these reviews is already ongoing.
The minister admitted that Pakistan’s circular debts have risen to 2.4 trillion rupee, but he expressed confidence that it would be eliminated within six years. He also referred to methodological challenges, including poor transport planning, non -competitive additions, high -end costs, and poor institutional coordination.
To support agricultural consumers, the government will convert the Balochistan tube wells into solar energy under a project worth 55 billion rupees. Service agreements are also signed with captive industries to ensure energy supplies without interruption.
Legari reiterated the last Prime Minister’s announcement of 7.41 rupees for each unit of reducing the electricity tariff for public consumers and 7.69 rupees for each unit of relief for industrial users. He pointed out that although these cuts will be reflected in the structure of the basic tariff, it was too early to determine whether the basic tariff would increase or decrease before June.
The government is also negotiating with international lenders, including the Asian Development Bank (ADB) and the World Bank, to finance the transportation system promotions. Legari said the processing of the network restrictions can provide an additional RS2 for each relief unit.
In addition, talks to convert Chinese power plants from imported CPEC to local coal and restructure their loans to reduce long -term costs.
In conclusion, Leghari stressed that all reforms are designed to build a competitive, transparent and effective electricity market that enhances economic growth while reducing consumer burdens.
