The challenges in Pakistan’s power sector, coupled with the mixed achievements of privatization, both domestically and internationally, highlight that no single model can fully address Pakistan’s unique requirements. Pakistan’s socio-political dynamics, bureaucratic challenges, corruption, economic disparities, and urban-rural divide demand a tailored, hybrid approach to privatization that leverages global best practices while adapting to local conditions. Strengthening Regulatory Framework and Incentives: A strong, independent regulatory authority is essential to oversee privatized entities and ensure they operate transparently and fairly. NEPRA’s capacity must be strengthened to establish clear performance standards, enforce service quality metrics, and facilitate timely tariff adjustments. Moreover, NEPRA should adopt a performance-based regulatory model that incentivizes DISCOs to reduce T&D losses and improve customer service. Drawing from models like the UK’s OFGEM, Pakistan must establish robust consumer protection mechanisms, especially given the socio-economic diversity across regions. NEPRA could implement mandatory service quality standards, ensure compliance with SAIFI and SAIDI metrics, and introduce a grievance redressal mechanism that allows consumers to hold utilities accountable. To address public resistance, the tariff-setting process should be transparent, with subsidies targeted specifically for low-income households. India’s cross-subsidization model, which protects vulnerable consumers while allowing tariff rationalization, could be adapted in Pakistan’s context to balance affordability with financial sustainability. Decentralized Operational Autonomy with Performance-Based Incentives: Major urban centres like Karachi, Lahore, and Islamabad offer substantial revenue opportunities and may be better suited to full privatization with performance incentives. Autonomy in these areas would allow DISCOs to make agile decisions, modernize infrastructure, and attract investments. Like Turkey, where privatization is backed by performance incentives, Pakistan can design KPIs that link DISCO revenue and management incentives to performance indicators like reduction in T&D losses and improved bill collection. On the contrary, privatization in rural areas presents unique challenges due to lower population density, higher T&D losses, and financial feasibility issues. A cooperative or community-owned model, as seen in Colombia and the Philippines, could be more effective. Local cooperatives, supported by government subsidies and regulated by NEPRA, can oversee distribution in rural areas, aligning service provision with community needs and promoting accountability. Public-Private Partnerships (PPPs) and Targeted Infrastructure Investments: To balance investment needs with service reliability, Pakistan can adopt a PPP model in areas where full privatization may not be viable. This approach would allow the government to retain partial control while encouraging private investment. Brazil’s public-private hybrid model serves as an effective example, where PPPs operate with regulatory oversight, and encouraging investment without transferring complete ownership. Further, given Pakistan’s energy mix and dependency on fossil fuels, investment in decentralized microgrids and renewable energy infrastructure needs to be prioritized. Encouraging DISCOs to develop solar, wind, and hybrid microgrids, especially in rural areas, would not only address T&D losses but also promote sustainability. Incentivizing private investment in these areas, like Brazil’s decentralized energy model, would enable Pakistan to reduce energy import costs and build a resilient energy network. Phased and Flexible Privatization with Regular Assessments: Instead of nationwide implementation, privatization could start with pilot projects in high-potential areas, such as Lahore and Faisalabad. These pilot projects would help NEPRA and stakeholders to evaluate and refine the regulatory framework, address initial challenges, and make necessary adjustments. Insights from pilot projects can be scaled to other areas as regulatory and operational models are stabilized. A phase-wise privatization approach with periodic reviews is essential to accommodate Pakistan’s unique socio-political landscape. A regular assessment of key performance indicators, including T&D losses, revenue collection, customer satisfaction, and regulatory compliance, would allow for flexibility and corrective measures. This phased approach enables adaptation to evolving political and economic conditions, reducing the risk of abrupt policy changes or resistance from stakeholders. Anti-Corruption Measures and Accountability: Corruption in public procurement and operational mismanagement are major barriers in Pakistan’s power sector. Implementing transparent procurement systems, supported by digital tracking and third-party audits, can curb corruption in privatized DISCOs. A transparent process, overseen by independent auditors, would ensure that resources are allocated efficiently. Furthermore, it is critical that going forward, private operators follow strong corporate governance practices. Governance structures should be established to prevent political interference, improve hiring practices, and enforce accountability at every level. Lessons from global privatization failures, such as those in Ukraine, show that inadequate governance leads to inefficiency and often results in renationalization. Thus, governance and policy reforms are essential for modernizing the power sector and promoting efficiency, sustainability, and innovation. By improving governance structures, introducing competition, reforming tariffs, and promoting renewable energy, countries can create a power sector that meets growing demands while addressing environmental and financial concerns. Although challenging, these reforms are necessary to support economic growth, ensure universal access, and reduce carbon emissions. Global case studies demonstrate that successful reforms require a customized approach that considers local contexts. With strategic planning and inclusive policies, governance and policy reforms can transform the power sector in Pakistan, laying a strong foundation for a reliable, affordable, and sustainable energy future. Establishing a competitive market structure in Pakistan’s power distribution sector holds the promise of improved efficiency, reduced costs, and better service quality. However, success hinges on addressing structural, regulatory, and investment-related challenges. Through careful planning, gradual implementation, and adopting best practices from successful international markets, Pakistan can build a reliable, consumer-friendly power distribution sector that supports sustainable economic growth. Pakistan’s unique social, economic, and political dynamics necessitate a hybrid privatization model tailored to regional characteristics. The success of this model will hinge on a robust regulatory framework, strong governance practices, and the inclusion of consumer protections, providing Pakistan with a sustainable path toward energy reform. (Concluded) Pakistan’s unique social, economic, and political dynamics necessitate a hybrid privatization model tailored to regional characteristics. The writer works at a public policy think tank. He can be reached at saudzafar5@gmail.com