10 investors bid for IESCO: what a sale means for Islamabad and Pindi bills

Ten investor groups filed expressions of interest for Islamabad Electric Supply Company by Monday's deadline, the Privatisation Commission said, and the government is offering between 51 and 100 per cent of the company with management control.

Three of the ten are Turkish. Seven are Pakistani, and the names are the ones that show up whenever a large asset comes up for sale.

Who wants it

Turkish bidders: Aktor Elektrik Enerji, Genvera Enerji and Cengiz Enerji.

Pakistani bidders, on their own: Engro Energy, Sapphire Fibres, Novatex and Bestway Cement.

Pakistani consortiums:

• Artistic Milliners, with The Lake City Holdings, Fatima Capital, Din Ventures and Fazal Cloth Mills.
• Hubco Power Holding, with Lucky Cement, Kohat Cement and Metro Ventures.
• Hasnaat Brothers Construction, with Dhilal Holding Group, Pak Steel, Bio-Labs and Farid Steel Casting.

Commission head Muhammad Ali said the response reflects investor confidence in the distribution sector and the government's commitment to a transparent process.

What happens next, and when

The EOIs and statements of qualification now go through prequalification. Groups that clear it get access to the virtual data room and start due diligence. No bid date has been announced, and no price has been discussed in public.

IESCO is in Batch-I of the DISCO privatisation programme along with FESCO in Faisalabad and GEPCO in Gujranwala. Ten parties have already been prequalified for FESCO. Eleven EOIs came in for GEPCO and are still being evaluated.

If you are an IESCO customer

IESCO supplies everything from Attock to Jhelum and from the Indus to the Neelum, by its own description, which means Islamabad, Rawalpindi, Attock, Chakwal and Jhelum districts.

Three things do not change on the day a buyer signs:

1. Your tariff. Electricity rates are determined by NEPRA and notified by the federal government, not set by the distribution company. A private owner of IESCO cannot raise your per-unit rate on its own.
2. Your connection. Supply obligations sit in the distribution licence, which transfers with the company.
3. Your outstanding bill. Arrears go to the new owner as receivables.

What does change is who chases losses. Distribution companies lose money on theft and unpaid bills, and the case for selling them is that a private owner goes after both harder. For a paying household in Rawalpindi that can mean fewer hours of load management on a feeder that currently gets punished for its neighbours' recoveries. It can also mean faster disconnection if you fall behind.

Work out what your own units cost on the electricity bill calculator, which covers IESCO along with LESCO, MEPCO and K-Electric.

The tariff question is separate

None of this is the same fight as the October tariff. DISCOs have asked NEPRA for Rs 1.73 a unit more for October under the monthly fuel charges adjustment, with a hearing on 29 September. That request moves your bill. The sale of IESCO, at this stage, does not.