ISLAMABAD: Pakistan this week invited European investors to participate in the privatization of its power distribution companies and broader energy sector reforms, as the government seeks to overhaul a financially strained electricity system.
Power Minister Sardar Awais Ahmed Khan Leghari made the pitch during a meeting on Sunday with a visiting European Union delegation, outlining plans to modernize infrastructure and open up investment opportunities across the sector.
Pakistan’s power sector has long struggled with high generation costs, transmission losses and mounting circular debt, making reform and privatization a key priority under ongoing economic restructuring efforts, including commitments linked to its $7 billion International Monetary Fund (IMF) program.
“The government is moving forward with the privatization of electricity distribution companies (DISCOs), offering opportunities for European firms to take part in the bidding process,” the statement from the power division said.
It added that the reform program includes digitization of the national grid through large-scale deployment of smart meters, expansion and upgrading of transmission infrastructure, and integration of utility-scale battery storage systems.
The government is also pursuing the divestment of older, inefficient residual fuel oil (RFO)-based power plants, which have contributed to high electricity costs.
“By excluding approximately 7,000 megawatts of expensive, committed power plants from the Indicative Generation Capacity Expansion Plan, Pakistan has achieved savings of $17 billion,” the statement said.
According to the statement, the European Union delegation, which included representatives from the European Investment Bank and EU mission in Pakistan, said the reforms had improved the investment climate and encouraged European firms to explore opportunities in the country’s energy sector.
