The government plans to install smart meters at DISCO transformers nationwide, aiming to reduce electricity theft, improve billing accuracy and protect consumers even after privatisation.
Pakistan plans to install smart meters at electricity distribution company (DISCO) transformers nationwide to identify power losses, curb electricity theft and prevent overbilling, Federal Minister for Economic Affairs Ahad Cheema announced Tuesday.
The proposed initiative will cover all distribution companies and continue even if individual DISCOs are transferred to private investors, according to the government. The project is intended to improve electricity billing accuracy and strengthen monitoring of losses across distribution networks.
Cheema announced the plan while chairing a meeting on DISCOs in Islamabad. Officials reviewed development programmes and progress on securing financing through the Economic Affairs Division (EAD). The meeting was informed that progress had been made in arranging funds for the initiative.
Power Minister Sardar Awais Ahmad Khan Leghari, the prime minister’s adviser on privatisation and senior officials from relevant ministries also attended.
Privatisation will not stop the project
A key element of the government’s announcement concerns the project’s continuation after privatisation. Cheema said arrangements would ensure that private investors take forward the smart metering initiative when they acquire distribution companies.
If a DISCO is privatised while financing discussions or programme preparations are underway, the relevant financing and development programmes would be transferred to the new owner as part of the handover under agreed terms.
He also said new projects undertaken by private investors within DISCOs would require competitive bidding and approval from the National Electric Power Regulatory Authority (NEPRA), where applicable.
Cheema stressed that privatisation should not create additional costs or unnecessary financial pressure for electricity consumers. He said the government would safeguard consumer interests and ensure investors fulfil their financial and contractual responsibilities.
Why transformer-level monitoring matters
Smart meters installed at transformers can help authorities compare the electricity entering a particular distribution area with the amount recorded through consumer meters.
Significant differences can indicate electricity theft, faulty metering or technical losses. This approach could help distribution companies identify problem areas more precisely instead of relying solely on broader network-level estimates.
However, the government has not announced how the collected data will be used, whether it will be publicly accessible or how many transformers will initially be covered.
Electricity losses and overbilling remain major concerns
The initiative comes amid persistent distribution losses. NEPRA data for fiscal year 2024-25 shows that DISCOs recorded average transmission and distribution losses of 17.55%, compared with an allowed limit of 11.43%. The estimated unrecovered impact of excess losses stood at Rs265 billion.
In September 2026, Leghari said electricity theft and line losses were affecting 3,500 feeders and contributing to power outages. The government subsequently ordered technical audits of all DISCOs to assess the extent and location of electricity theft.
Separately, audit officials told a Public Accounts Committee subcommittee that DISCOs were involved in an alleged Rs47 billion overbilling scam intended to conceal inefficiencies, theft and distribution losses. They said refunds had been issued only to consumers who filed complaints.
Smart metering has shown some progress
The Ministry of Power previously informed a Senate committee that the installation of 800,000 advanced metering infrastructure (AMI) smart meters in Islamabad, Rawalpindi and Taxila had reduced line losses by 2%.
Officials have also claimed that areas using transformer-based metering have not reported overbilling complaints. However, independent verification of these claims would provide a clearer assessment of the system’s effectiveness.
The latest announcement did not specify the project’s total cost, implementation schedule, number of transformers or financing arrangements beyond the EAD’s involvement.
The government’s challenge will be to translate the announcement into measurable progress, particularly as Pakistan continues considering the privatisation of its electricity distribution companies.
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