Energy sector reforms are showing measurable results, with electricity distribution losses and circular debt reduced during the last fiscal year, according to official government documents.
Electricity distribution companies, or DISCOs, recorded losses of Rs397 billion, which is Rs242 billion lower than the Rs649 billion ceiling set by the International Monetary Fund.
Officials attribute the reduction in losses to strengthened governance, tighter financial discipline, and improved controls implemented across Pakistan’s power sector over the past fiscal year.
Circular debt fell by Rs780 billion, marking one of the most substantial improvements in the energy sector in recent years, reflecting economic and administrative measures undertaken.
Read More: High Energy Prices Threaten Industry
Out of Rs1,323 billion allocated for power subsidies, only Rs1,225 billion was utilised, showing better targeting of subsidies and reduced leakages, which eased pressure on public finances.
Economic and administrative measures resulted in savings of Rs175 billion, reflecting government efforts to stabilise the power sector while improving efficiency and reducing unnecessary expenditures.
The government absorbed Rs363 billion in late payment surcharges instead of passing the charges to consumers, protecting electricity users from additional financial burdens across the country.
Officials say these early improvements in losses, circular debt, and consumer protections indicate positive trends that suggest long-term stability and sustainability of Pakistan’s energy sector economy.
