Abdul Ghani

Pakistan’s state-owned enterprises (SOEs) in the power sector recorded combined losses of Rs242.7 billion during fiscal year 2025, while electricity distribution companies recovered only a portion of their operating costs, according to the Federal State-Owned Enterprises Annual Aggregate Report FY2025.

The report shows that the power sector posted a net loss of Rs242,678 million during the year, compared with a loss of Rs223,838 million in FY2024. Total revenues of the power sector were recorded at Rs3.87 trillion in FY2025, down from Rs4.05 trillion in the previous fiscal year.

Balance sheet figures indicate that the sector held total assets of Rs8.42 trillion and liabilities of Rs9.22 trillion. The difference resulted in negative equity of Rs800.5 billion. The report also provides operational data for distribution companies (DISCOs), including their operating cost recovery ratios (OCRR), which measure the extent to which operating revenues cover expenses.

For loss-making SOEs overall, the OCRR declined to 0.80, meaning that for every Rs100 spent on operations, only Rs80 was recovered in revenue.

Among DISCOs, Quetta Electric Supply Company (QESCO) recorded the lowest OCRR at 0.54, with a core operating loss of Rs112.6 billion. Peshawar Electric Supply Company (PESCO) posted an OCRR of 0.73 and a core operating loss of Rs104.7 billion. Sukkur Electric Power Company (SEPCO) reported an OCRR of 0.75 and a loss of Rs29.9 billion.

Hyderabad Electric Supply Company (HESCO) recorded an OCRR of 0.93 and a loss of Rs13.4 billion, while Lahore Electric Supply Company (LESCO) posted an OCRR of 0.93 and a core loss of Rs46.1 billion. Islamabad Electric Supply Company (IESCO) registered an OCRR of 0.97 with a loss of Rs10.8 billion. Multan Electric Power Company (MEPCO) reported an OCRR of 0.97 and a loss of Rs12.4 billion.

Two companies recorded positive core earnings. Faisalabad Electric Supply Company (FESCO) reported an OCRR of 1.02 and core earnings of Rs11.0 billion, while Gujranwala Electric Power Company (GEPCO) posted an OCRR of 1.03 with earnings of Rs11.7 billion. Total subsidies provided to DISCOs during FY2025 amounted to Rs551.6 billion, according to the report.

The report also notes that the power sector continued to struggle with circular debt. However, the overall stock of circular debt declined during the year, falling to Rs1.89 trillion from Rs2.44 trillion in FY2024.

The figures form part of the government’s annual consolidated review of operational and financial performance of state-owned enterprises in the power sector, including generation, transmission and distribution entities, for the fiscal year ended June 2025.

Credit: INP-WealthPk