ISLAMABAD: The government has decided to give a central role to the Special Investment Facilitation Council (SIFC) in expediting the privatisation process of power Distribution Companies (Discos) with Lt General Sarfraz Ahmed, National Coordinator of the SIFC’s inclusion as a member of the steering committee on Discos privatisation, sources in the Privatisation Commission informed Business Recorder.
In August 2024, Prime Minister Shehbaz Sharif constituted a steering committee, headed by Deputy Prime Minister/Foreign Minister, Senator Ishaq Dar, to lead the privatization of Discos.
The committee’s members include: (i) Minister for Privatisation; (ii) Minister for Power; (iii) Minister for Information and Broadcasting; (iv) Minister for Finance and Revenue; (v) Special Assistant to Prime Minister on Power; (vi) Secretary Power Division; (vii) Secretary Privatisation Division and; (viii) Secretary Privatisation Commission.
CCP for sell-off of Discos or exploring PPPs
The Steering Committee was revised at a time when the Task Force on Energy was already engaged with Independent Power Producers (IPPs) to negotiate settlements for their contracts aimed at reducing electricity tariffs. However, an official, speaking on condition of anonymity, noted that the treatment of IPPs has cast doubt on the prospects for the successful privatization of Discos, particularly following the recent incident where an IPP owner was allegedly stopped at the airport.
According to a new notification issued by the Ministry of Privatisation, Lt. General Sarfraz Ahmed’s inclusion in the Steering Committee is part of the government’s efforts to accelerate the privatization of Discos. This follows the August 15, 2024, notification regarding the formation of the Steering Committee for fast-tracking the privatization process.
The sources said initially the government has decided to privatise three better-performing Discos, ie, Islamabad Electric Supply Company (Iesco), Gujranwala Electric Power Company (Gepco), and Faisalabad Electric Power Company (Fesco).
The Terms of Reference of the committee are as follows to guide and spearhead privatisation process of Discos with the objective of fast tracking it though a whole of government approach: (ii) to review and rationalise timelines to achieve privatisation of Discos at an accelerated pace; (iii) to develop a comprehensive communication strategy to inform and educate stakeholders about the privatisation process and its benefits and to allay any fears and misgivings; (iv) to ensure compliance with relevant laws, rules, regulations, and industry standards throughout the privatisation process; (v) to devise an effective mechanism for inter-ministerial consultations and coordination for fast-track approvals involved in privatisation of Discos; (vi) to proactively identify and mitigate potential risks and challenges associated with the privatisation of Discos; (vii) to review any other related issue(s), which require consideration of the Committee; and (viii) the Committee may co-opt any other member as per requirement.
The Committee is submitting a weekly progress report highlighting through a matrix the milestones set versus achieved in privatisation of Discos for perusal of the Prime Minister. Privatisation Division in close liaison with Power Division is providing secretarial support to the committee.
Copyright Business Recorder, 2024
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