ISLAMABAD: The performance of Lahore Electric Supply Company (LESCO) has reportedly remained significantly short of mandatory performance targets set by National Electric Power Regulatory Authority (Nepra), sources told media.
LESCO has highlighted a series of achievements, including a reduction in transmission and distribution (T&D) losses, Rs35 billion savings from loss control, Rs23 billion improvement in recoveries, and procurement efficiencies in Advanced Metering Infrastructure (AMI).
However regulatory documents, including Nepra’s Multi-Year Tariff (MYT) determination, the State of Industry Report 2025, and the Performance Evaluation Report 2024-25, present a more cautious picture.
READ MORE: Lesco saves over Rs138bn; T&D losses cut to 13.4pc
Loss Reduction Falls Short of Targets: While LESCO claims to have reduced T&D losses from 15.8 percent to 13.4 percent, Nepra’s MYT benchmarks required losses to be brought down to 10 percent in FY2023-24 and 9.46 percent in FY2024-25. Actual reported losses stood at 15.92 percent and 13.7 percent, respectively — well above the allowed thresholds.
According to Nepra’s Performance Evaluation Reports, this shortfall resulted in a financial impact of Rs39.4 billion in FY2023-24 and Rs35.17 billion in FY2024-25. Analysts note that the reported “savings” reflect partial mitigation of inefficiencies rather than compliance with regulatory standards.
Penalty Signals Non-Compliance: In October 2025, Nepra imposed a Rs25 million penalty on LESCO for excessive losses, formally establishing regulatory non-compliance. Observers argue that such enforcement actions undermine claims of a full operational turnaround.
Recovery Gains Seen as Incremental: LESCO has reported Rs23 billion improvement in recoveries and near 100 percent year-end recovery rates. However, Nepra’s evaluation highlights continued variability in recovery ratios, accumulation of receivables, and limited reduction in overdue balances.
Sector-wide data in the State of Industry Report 2025 indicates that circular debt pressures and receivables remain persistent challenges, suggesting that LESCO’s recovery improvements are incremental rather than structural.
AMI Savings Yet to Materialize: The utility also pointed to projected national savings of Rs60–70 billion through AMI meter procurement. However, experts caution that such projections cannot be treated as realized savings until full deployment and operationalization occur. Regulatory filings have yet to validate these claims at the stated scale.
Broader Performance Indicators Overlooked: Under NEPRA’s MYT framework, utilities are evaluated across multiple parameters, including collection efficiency, operational expenditure control, capital investment discipline, and service quality. Critics say LESCO’s public communications focus narrowly on selected financial indicators, omitting key performance areas.
Reliability and Service Quality Concerns: LESCO’s system reliability indicators also fall short of targets. The reported System Average Interruption Frequency Index (SAIFI) stands at 28.16 against a target of 13, while the System Average Interruption Duration Index (SAIDI) is 2,982.94 minutes compared to an allowed 14 minutes.
NEPRA’s report further highlights service delivery gaps, including delays in new connections, high fault rates, and weak consumer complaint handling. As of June 2025, around 28,984 connections remained pending, while fault rates per kilometer were the highest among distribution companies.
Improvement Without Transformation: Analysts acknowledge that LESCO has made some progress, with losses declining from 15.92 percent to 13.4 percent. However, they stress that regulatory compliance requires single-digit losses and sustained performance improvements.
Experts further emphasized that performance in the power sector must be judged against regulatory benchmarks rather than internal assessments. They argue that while progress should be recognized, public messaging must align with actual compliance levels.
Copyright media, 2026
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