The federal government has decided to install smart meters on transformers across all power distribution companies (DISCOs) in Pakistan, in a move aimed at cutting electricity theft, improving billing accuracy and protecting consumers from overbilling.

The decision was taken at a meeting in Islamabad on Tuesday, 10 November 2026, chaired by Federal Minister for Economic Affairs and Establishment Division Ahad Cheema. Federal Minister for Power Division Sardar Awais Ahmad Khan Leghari and the Prime Minister's Adviser on Privatisation also attended, along with senior officials from the relevant ministries.

What was decided

The meeting reviewed the development programmes of the DISCOs and the Economic Affairs Division's efforts to arrange financing for the smart metering project. According to an official statement issued after the meeting, participants noted positive progress in securing funding for the proposed system.

Smart meters fitted to transformers allow a distribution company to measure the electricity that enters a section of the network and compare it with the electricity billed to consumers in that area. The gap between the two figures shows where losses or theft are taking place, and it gives the company a far clearer picture of which feeders and neighbourhoods need attention.

The government has not yet published a cost estimate for the project, the number of transformers to be covered, or a timetable for installation. Those details are expected to emerge as financing arrangements are finalised with development partners.

Why transformer meters matter

Electricity theft and distribution losses have long been among the most persistent problems in Pakistan's power sector. Losses on some feeders run high, and the cost is ultimately passed on to paying consumers through higher tariffs or to the government through subsidies.

By metering at the transformer rather than only at individual homes, a DISCO can pinpoint losses to a small area instead of an entire feeder. That makes it easier to target enforcement, fix faulty equipment and identify where bills do not match consumption. The meeting heard that the system would also help protect consumers from overbilling, because usage would be measured and recorded rather than estimated.

Privatisation will not stop the rollout

A central part of the discussion was what happens to the project as the DISCOs move towards privatisation. Cheema said the government would make arrangements to ensure that private investors carry the smart metering initiative forward after taking control of a distribution company.

If a DISCO is privatised while financing negotiations or programme preparations are still under way, the relevant development programmes and financing arrangements would be transferred to the private investor as part of the handover, subject to agreed terms. Negotiations with multilateral development partners for funding will continue until the privatisation process is completed, with the World Bank and the Asian Development Bank among the lenders the government is approaching.

The meeting also discussed safeguards for projects undertaken by private investors. Cheema emphasised that any new project initiated within a DISCO must go through competitive bidding and obtain approval from the National Electric Power Regulatory Authority (NEPRA), wherever required. He stressed that privatisation should not result in additional costs or undue financial pressure on electricity consumers, and that the government would facilitate the process while protecting consumer interests.

Part of a wider metering push

The transformer metering plan sits alongside a wider shift towards advanced metering in Pakistan. In July 2026, Prime Minister Shehbaz Sharif called for nationwide smart meter installation, and a proposal to install around 16.2 million single-phase advanced metering infrastructure (AMI) meters across the Multan, Lahore, Peshawar, Hazara and Quetta distribution companies has been under consideration. Around 1.5 million AMI meters were already installed by late 2025, with losses reported to have fallen by about 2 per cent in areas where AMI and asset performance management systems were in use.

For now, the transformer metering decision is a plan backed by a financing effort rather than a completed rollout. The next steps to watch are the outcome of the funding negotiations with multilateral partners, the publication of a cost and coverage plan, and the first installations on the ground.