Nepra cuts SEPCO’s proposed investment after raising concerns over project execution, asset utilisation and data quality, while imposing stricter performance conditions.
ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has approved a Rs21.436 billion Distribution Investment Plan (DIP) for Sukkur Electric Power Company (SEPCO) for the five-year Multi-Year Tariff period from fiscal year 2025-26 to FY2029-30, while setting strict conditions to improve network performance and reduce electricity losses.
SEPCO had initially sought approval for an investment programme worth Rs90.563 billion. Following questions from the regulator over project justification, costs, existing asset utilisation and future requirements, the utility revised its proposal to Rs40.191 billion in June 2026.
Nepra ultimately approved a significantly lower investment programme, citing weaknesses in the original submission and stressing that future projects must be supported by reliable field data, realistic demand forecasts and proper assessments of existing infrastructure.
The regulator also highlighted SEPCO’s weak utilisation of previously approved investment. During the previous control period, the company had been allowed Rs39.509 billion, but utilised only Rs14.231 billion, or roughly 36% of the approved amount.
Nepra attributed delays in several projects, particularly those under the STG category, to land acquisition problems, procurement issues and poor coordination among departments. The authority directed SEPCO to strengthen project planning, milestone monitoring and implementation.
The approved plan focuses on strengthening and expanding the 132-kilovolt network, improving capacity for future demand and introducing technologies such as Advanced Metering Infrastructure (AMI), SCADA and GIS-based network mapping.
Nepra also directed SEPCO to improve preventive maintenance, energy accounting and system controls to address transmission and distribution losses and reliability indicators such as SAIFI and SAIDI.
A major condition requires SEPCO to hire an independent third-party consultant to validate future investment plans before submission to Nepra. The utility must also develop detailed Terms of Reference and obtain regulatory approval before starting the procurement process.
The regulator has further ordered SEPCO to replace manual operational data management with an integrated digital system and submit a mid-term review by December 2027 covering demand forecasts, project progress and financial performance.
For FY2025-26 and FY2026-27, Nepra has set a provisional T&D loss target of 16.31%, including a 1% allowance for law-and-order conditions. An independent international assessment of SEPCO’s losses has also been made mandatory.
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