Islamabad 12 August: The National Electric Power Regulatory Authority (Nepra) has imposed penalties worth Rs95 million on two Sindh-based power distribution companies for exceeding loss targets, underperforming in recoveries, and violating safety protocols in the fiscal year 2023–24.
Sukkur Electric Power Company (Sepco) was fined a total of Rs70 million, including Rs50 million for failing to meet loss and recovery benchmarks and Rs20 million for not properly grounding electricity poles and breaching safety regulations. Hyderabad Electric Supply Company (Hesco) was penalised Rs25 million for similar shortcomings.
The action follows Nepra’s Circular Debt Report for FY24, which showed national electricity losses rising to 18.31% from 16.84% a year earlier — far above the regulator’s target of 11.77%. The losses contributed an estimated Rs276 billion to the country’s circular debt.
Despite Rs163.1 billion spent on network improvements, distribution companies failed to reduce losses. Sepco’s transmission and distribution losses climbed to 34.91% from 34.43%, inflicting Rs29.1 billion in financial losses compared with Rs20.4 billion in FY23. Hesco’s losses inched up to 27.62% from 27.53%, with the financial hit increasing from Rs15.1 billion to Rs23.2 billion.
Recovery rates also lagged. While the national average stayed at 92%, unrecovered dues rose to Rs315 billion from Rs236 billion. Sepco’s recovery rate fell to 65% from 67%, with unrecovered amounts swelling to Rs38 billion from Rs27 billion. Hesco missed its recovery targets, though detailed figures were not disclosed.
During regulatory proceedings, both companies attributed poor performance to high tariffs, weak economic conditions, political interference, and electricity theft. Nepra, however, rejected these justifications as unsubstantiated.
The regulator stressed that the fines aim to enforce accountability, improve operational efficiency, and reduce the financial burden on consumers caused by persistent distribution inefficiencies.
