NEPRA to Get Enhanced Powers Through New Legislation

ISLAMABAD: The National Assembly Standing Committee on Cabinet Secretariat has resolved to introduce legislation designed to grant the National Electric Power Regulatory Authority (NEPRA) greater authority in monitoring enforcement, ensuring accountability, and acting against entities within the power sector, all aimed at protecting and assisting consumers.

The committee has instructed NEPRA to formulate a draft of the proposed legislation to amplify its function and powers, and then submit it for endorsement. The committee highlighted that rigorous monitoring of distribution companies is crucial for enhancing service quality.

The committee convened at the NEPRA office on Thursday, under the leadership of Member of the National Assembly (MNA) Malik Ibrar Ahmed.

The committee received a detailed briefing on NEPRA’s role as a regulator, its effectiveness, the issue of circular debt, the energy sector, and efforts to control line losses and electricity theft.

Responding to inquiries from committee members, NEPRA Member (Technical) Sindh, Rafique Ahmed Shaikh, clarified that the organization’s mandate is currently limited by existing laws and regulations. He informed the committee that a team of five members is stationed in each distribution company for oversight. He noted that NEPRA has initiated legal actions against distribution companies (DISCOs) that are experiencing increased losses. Thus far, Hyderabad Electric Supply Company (HESCO) has been fined Rs50 million, and Sukkur Electric Supply Company (SEPCO) has been fined Rs25 million, with proceedings against other DISCOs still in progress.

Addressing questions regarding capacity payments to Independent Power Producers (IPPs), Shaikh pointed out that IPPs are not exclusive to Pakistan, as similar producers operate in other nations. He stated, “We entered into agreements with IPPs on capacity payments because, at that time, Pakistan faced an electricity shortage and urgently required additional power. However, our generation capacity is now adequate.” He further commented, “Resolving the challenges in the electricity sector requires prioritizing distribution companies (DISCOs). For example, we have set a line loss target of 8 percent for the Islamabad Electric Supply Company (IESCO). Losses exceeding this target contribute to the circular debt.”

Senior Advisor (Legal) Mian Ahmad Ibrahim briefed the committee, noting that electricity consumers throughout Pakistan received unusually elevated bills in June 2024. He explained that NEPRA investigated the matter and discovered that the problem stemmed from some distribution companies not adhering to the standard 30/31-day billing cycle. He indicated that delays in meter readings and the failure to adjust billing days led to inflated charges. He confirmed that all affected bills were subsequently corrected, and consumers received appropriate relief.

He reported that a total of 1.58 million consumers were impacted by overbilling, with adjustments of Rs3.55 billion made to provide relief. Among these, 434,856 consumers of Multan Electric Power Company (MEPCO) were overbilled by Rs961 million, while 371,107 consumers of Gujranwala Electric Power Company (GEPCO) were overbilled by Rs892 million. Similarly, 178,516 consumers of Lahore Electric Supply Company (LESCO) were affected, he said. He added that other distribution companies involved included FESCO, HESCO, PESCO, QESCO, SEPCO, K-Electric, and IESCO.

He noted that affected electricity consumers can file complaints with NEPRA through a free digital application.

Regarding quarterly and monthly relief measures, he mentioned that a negative adjustment of Rs1.881/kWh has been approved and is being applied to billing months from August 2025 to October 2025.

He confirmed that defective meters were promptly replaced to prevent average billing and that NEPRA issued notices to DISCOs to take disciplinary action against executive engineers (XENs) found in violation of the Consumer Services Manual (CSM).

Addressing the monitoring and control of line losses and theft, Mian Ahmad Ibrahim informed the committee that NEPRA maintains a clear policy where only technical losses are recognized in tariff determinations. Commercial losses resulting from theft and non-recovery are not passed on to consumers; instead, DISCOs bear the burden.

Regarding affordable electricity supply, he stated that for the financial year 2025–26, NEPRA has determined an average national tariff of Rs34/kWh, compared to Rs35.5/kWh in the previous financial year, representing a reduction of Rs1.5/kWh that directly benefits consumers.

Concerning circular debt, he reported that according to the Ministry of Energy’s report as of June 30, 2025, the circular debt amounts to Rs1.614 trillion. Operational inefficiencies of DISCOs, including excess Transmission and Distribution (T&D) losses of Rs265 billion and under recoveries of Rs132 billion, continue to be significant contributors.

The committee emphasized the need to improve the overall performance of the power sector to ensure that consumers receive a consistent and affordable electricity supply.

The committee instructed NEPRA to closely monitor DISCOs to enhance their performance and ensure compliance with the regulatory framework. NEPRA was also directed to oversee the restoration of electricity infrastructure damaged by floods and rains.

The committee resolved to postpone discussion on two private members bills seeking amendments in the Civil Servants Act, 1973, concerning restrictions on re-employment after retirement, until its next meeting. The committee requested the movers of the bill to provide a detailed explanation of the rationale behind the proposed amendment. The committee also deferred discussion on another private members bill titled Civil Servants Amendment Bill pending the final outcome of deliberations by the secretary’s committee and the presentation of a report to the prime minister.

The meeting saw attendance from MNAs Tahira Aurangzeb, Nuzhat Sadiq, Dr Nelson Azeem, Farah Naz Akbar, Pir Ameer Ali Shah Jeelani, Nawabzada Mir Jamal Khan Raisani, Khurram Munawar Manj, Syed Raza Ali Gillani, Shandana Gulzar Khan, Shahida Begum, Rana Ansar, and Muhammad Aslam Ghumman (via Zoom), along with Movers Noor Alam Khan (MNA), Sahibzada Sibghatullah (MNA), Usama Ahmed Mela, the special secretary of the Cabinet Division, the special secretary of the Establishment Division, and other officers from relevant departments.