Pakistan’s power sector appears to be caught between two conflicting impulses. On one hand, the government is pushing forward with a bold plan to privatize multiple electricity distribution companies (DISCOs), touting it as part of a long-term market liberalization strategy.

On the other, it continues to multiply state-owned enterprises (SOEs), such as the newly-formed Hazara Electric Supply Company (HAZESCO), raising questions about whether there is genuine reform underway or merely an administrative reshuffling with little substantive change.

In May 2025, the government moved to privatize three major Discos — IESCO, FESCO, and GEPCO — as part of its Phase I privatization program. These are some of the relatively better-performing utilities, which suggests a revenue-maximizing strategy rather than a structural reform approach.

Phase II is expected to include LESCO, MEPCO, and – ironically — HAZESCO, a company only just brought into existence. This apparent contradiction lies at the heart of the confusion: while some entities are being handed off to the private sector, new SOEs are simultaneously being created, staffed, and resourced from scratch. Is this a strategy or a contradiction?

HAZESCO was officially incorporated in October 2023 and granted NEPRA’s distribution and supply licences in May 2025. It was carved out from PESCO to manage the electricity needs of the Hazara Division, ostensibly to improve regional accountability and operational........

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