Privatization of IESCO, FESCO and GEPCO
Government Set to Privatize IESCO, FESCO, and GEPCO by December-End. What It Means for Pakistan’s Power Sector?
In a significant move that could reshape the landscape of Pakistan’s power sector, the government has announced plans to privatize three major electricity distribution companies — IESCO (Islamabad Electric Supply Company), FESCO (Faisalabad Electric Supply Company), and GEPCO (Gujranwala Electric Power Company) — by the end of December 2025.
This strategic sell-off is part of a broader economic reform agenda to reduce government fiscal burdens, enhance operational efficiency, and attract private sector investment in the country’s energy sector. Burraq Consulting, with its expertise in regulatory advisory and energy sector transformation, sheds light on what this transition means for the power industry, consumers, and investors.
Background of the Sell-Off
Pakistan’s power sector has long been riddled with inefficiencies, mounting circular debt, and service delivery issues. State-owned distribution companies (DISCOs) like IESCO, FESCO, and GEPCO have been at the heart of these challenges due to bureaucratic management, non-payment of dues, high transmission losses, and electricity theft.
The privatization of these entities has been under consideration for years, but the current government, under pressure from the IMF and driven by its own structural reform agenda, has now set a concrete deadline: December 2025.
Expected Impacts of Privatization
📈 1. Increased Efficiency and Service Quality
Private operators are likely to introduce modern management systems, automation, and customer-centric service models. This could mean reduced load shedding, faster complaint resolution, and improved billing accuracy.
💰 2. Reduced Burden on National Exchequer
Privatization will shift operational and investment costs from the government to the private sector, reducing fiscal pressure and possibly freeing up funds for infrastructure and social services.
⚠️ 3. Regulatory Challenges
NEPRA (National Electric Power Regulatory Authority) will need to play a stronger role in tariff regulation, consumer protection, and performance benchmarking. Burraq Consulting offers specialized advisory services to help both public and private stakeholders navigate these regulatory waters.
🧑🤝🧑 4. Impact on Employees
Privatization may lead to restructuring and performance-based accountability. This will require proactive HR and labor policy handling to avoid unrest and maintain operational continuity.
Why IESCO, FESCO, and GEPCO?
Among the 10 DISCOs operating under the umbrella of the Power Division, IESCO, FESCO, and GEPCO are considered the most commercially viable and technically sound. These companies have relatively better recovery ratios, fewer losses, and serve economically strong regions.
Key Facts:
- IESCO serves Islamabad and surrounding areas.
- FESCO covers Faisalabad, the textile hub of Pakistan.
- GEPCO operates in the Gujranwala region, a key industrial zone.
Their privatization is expected to be more attractive for investors and therefore has been prioritized in the first phase.
Risks and Concerns
While the sell-off appears promising, it is not without risks:
- Monopoly concerns: Private owners may prioritize profits, leading to price hikes unless properly regulated.
- Implementation delays: Past attempts at privatization have stalled due to political resistance and union pressures.
- Investor skepticism: Global investors may be wary due to Pakistan’s political volatility and security concerns.
Burraq Consulting recommends establishing transparent bidding procedures, stakeholder consultation, and guarantees for investors to ensure a successful transition.
Opportunities for Investors and Businesses
The privatization initiative presents unprecedented opportunities:
- Local and international firms in energy, utilities, and infrastructure can partner or invest in these DISCOs.
- Technology providers can introduce smart metering, digital billing, and grid automation.
- Consultants and regulatory experts (like Burraq Consulting) will play a key role in facilitating the transition, compliance, and performance audits.
We at Burraq Consulting specialize in corporate restructuring, regulatory compliance, and energy sector consulting. With decades of combined experience, our team is well-positioned to advise stakeholders on:
- Due diligence and valuation
- Privatization bidding support
- Regulatory compliance with NEPRA and SECP
- Labor law advisory and HR restructuring
- Operational audits and process improvement
Conclusion
The planned sell-off of IESCO, FESCO, and GEPCO is a milestone in Pakistan’s economic reform journey. If managed strategically and transparently, it could be a game-changer for the country’s energy infrastructure, opening the door for innovation, accountability, and improved service delivery.
