The government has decided to privatize Lahore Electric Supply Company (LESCO) and Multan Electric Power Company (MEPCO) in their current form.
Officials had earlier considered splitting both companies into smaller distribution entities before privatization. However, a technical committee found that the proposed restructuring could delay the process. The committee therefore recommended proceeding with the privatization of both companies without bifurcation. The decision is expected to reduce administrative hurdles and help move the transaction forward.
The committee was headed by Sajid Akram, Advisor for Power at the Privatization Commission. It included representatives from the Privatization Commission, Power Division, National Electric Power Regulatory Authority and Power Planning and Monitoring Company.
Financial Adviser to Support Privatization Process
The Privatization Commission has also decided to appoint a Financial Adviser for private sector participation in LESCO and MEPCO. Interested firms and consortiums with relevant transaction experience can participate in the process. The commission has also made the Request for Proposal package available.
MEPCO remains Pakistan’s largest electricity distribution company by consumer base. It serves around 8.76 million consumers across 13 districts in southern Punjab.
Its network covers more than 82,000 kilometres of distribution lines. It also operates over 780 grid stations.
Meanwhile, LESCO serves approximately 7.05 million consumers. Its service area includes Lahore, Kasur, Sheikhupura, Nankana Sahib and Okara.
The company operates through eight operation circles and 41 divisions.
Power Companies Face Operational Challenges
Despite their extensive networks, both companies continue to face challenges. Electricity theft, line losses and weak recoveries remain major concerns. Their overall performance has also remained weaker than some other distribution companies in Punjab.
Nevertheless, both companies have pursued modernization efforts. LESCO has introduced Advanced Metering Infrastructure and digital billing initiatives. The company aims to shift its consumers toward smart metering by 2029. Similarly, MEPCO has focused on smart meters, grid modernization and digital billing.
However, FY2024-25 audits showed unsatisfactory overall performance for both companies. Therefore, privatizing them without prior restructuring could help avoid further delays.
The government can now focus on attracting private sector participation while retaining the companies’ existing structures.
