The National Electric Power Regulatory Authority (NEPRA) has granted DHA Energy Supply Company (DESCO) two licences for DHA City Karachi. The first is a NEPRA distribution licence, and the second makes DESCO the development’s supplier of last resort. RIAA Barker Gillette advised DESCO throughout the application. No licensee outside the legacy utilities had previously held both under the competitive trading bilateral contract market (CTBCM) regime. In practice, a property development has become its own electricity utility.
Why the licences mattered
DHA City sits some 56 kilometres from Karachi on the M-9 motorway, beyond the reach of the national grid and K-Electric. Its nearest source of power is Lucky Cement Limited, from which DESCO has agreed to procure six megawatts. The existing arrangement with K-Electric expires on 30 September 2026, and the new licences therefore run from 1 October 2026 for 20 years.
Overcoming the objections
K-Electric, Gujranwala Electric Power Company and the Central Power Purchasing Agency all objected. Each questioned DESCO’s finances, its technical capability and its track record. NEPRA dismissed the objections, however. It held that the amendments to its Act aim to end exclusivity in distribution and separate supply from the wires. Where DESCO’s own balance sheet fell short, the regulator looked instead to the financial strength of its parent, DHA Karachi, and wrote consumer protections into the licence conditions.
The firm’s role
Nadir Altaf, Partner, led the consortium of legal, technical and financial advisers. Noor Tariq, Associate, supported him through the hearings and the post-hearing rounds that followed. Before the applications could proceed, the team dealt with an existing memorandum of understanding between K-Electric and DHA City on energising two feeders. That arrangement kept power flowing while the new structure took shape. The firm then advised on the structure DESCO needed to hold a NEPRA distribution licence, with distribution and supply ring-fenced.
“The CTBCM framework exists to admit new entrants, and this is the first property development to test it on the distribution side,” said Nadir Altaf. “NEPRA has shown that it will look through a start-up’s balance sheet to its sponsor, provided consumer protections are hard-wired into the licence.”
What it signals
NEPRA has cautioned that the grant is not a blanket policy for housing societies. Even so, the decision gives developers a worked example of what a NEPRA distribution licence application must prove. As Pakistan’s power sector opens to competition, that example will matter.
Nadir Altaf (Partner – Pakistan) led the team, which included Noor Tariq (Associate).
For advice on electricity licensing, energy regulation or infrastructure projects in Pakistan, contact Nadir Altaf today.
This article is not legal advice; it provides information of general interest about current legal issues.
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RIAA Barker Gillette is Pakistan’s premier law firm, with an on-the-ground presence in three major cities in Pakistan: Karachi, Islamabad and Lahore, and affiliated offices in Dubai (DIFC) and London.
The firm practices in all areas of corporate, commercial and dispute resolution law. Leading international legal directories consistently recognise the firm as a top-tier law firm in Pakistan.
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