According to the latest performance evaluation by the National Electric Power Regulatory Authority (NEPRA), Pakistan’s power distribution system is losing more than Rs. 1 trillion annually. The fiscal year 2025 report highlights that persistent inefficiencies in transmission, distribution, and billing are pushing the entire sector further into financial distress.
Mounting Losses From Transmission, Billing Failures
NEPRA found that combined transmission and distribution losses, together with poor recovery of bills, continue to cripple power companies. Ex-WAPDA distribution companies recorded transmission and distribution losses of 17.55 percent. In addition, approximately 3.5 percent of billed electricity went uncollected due to weak recovery systems. As a result, losses reached about Rs. 910 billion from these companies alone. When K-Electric’s contribution is added, total losses crossed the Rs. 1 trillion mark.
The regulatory body noted that none of the distribution companies met their technical loss targets during the year. Consequently, inefficiencies added an extra financial burden of Rs. 265 billion on the system. NEPRA singled out the highest losses: PESCO at Rs. 87.48 billion, followed by QESCO at Rs. 52.41 billion, SEPCO at Rs. 36.04 billion and LESCO at Rs. 35.17 billion.
Operational Challenges Hurt Service and Safety
Beyond financial losses, the power sector struggled to keep operations smooth. Frequent load shedding disrupted daily life for households and slowed business activities, while delays in new connections left many customers frustrated and waiting. NEPRA also pointed out that outdated and unreliable billing systems made it harder for companies to collect payments, deepening the sector’s financial woes.
Safety has become a serious concern as well. In FY25, 118 people lost their lives due to power-related incidents, including 38 employees and 80 members of the public. IESCO reported the most incidents, followed by PESCO, K-Electric, and HESCO, highlighting persistent operational risks across the system.
NEPRA warned that revenue-based load shedding has not worked as intended and has actually added to the growing circular debt. The regulator emphasized that until the sector addresses inefficiencies, weak governance, and gaps in enforcement, Pakistan’s power system will continue to struggle, putting an even heavier burden on the economy and the everyday lives of its citizens.
