Strategic Technology Roadmap for MEPCO

Renewable Energy and Energy Efficiency II (REEE II)

Final Version v2.0

December 2023
Strategic Technology Roadmap for MEPCO

Renewable Energy and Energy Efficiency II - Pakistan

For: Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH

Assignment: REEE II
VN: 81267367
PN: 19.2142.8-003.00
Implemented by: INTEGRATION environment & energy GmbH &
GOPA-Intec Consulting GmbH
on behalf of GIZ Pakistan and AEDB

Lead Author: Syed Faizan Ali Shah

Contributing Authors: Hani El Sabbagh, Modi Jaimin

Your Contact:
INTEGRATION environment & energy GmbH
Bahnhofstrasse 9
D-91322 Gräfenberg / GERMANY

Tel. +49(0)9192-9959-0
Fax +49(0)9192-9959-10

Direct Contact Person:

Gerd Schober
gschober@integration.org

Syed Faizan Ali Shah

falishah@integration.org
faizan_alishah@hotmail.com
 MEPCO ROADMAP – TABLE OF CONTENTS

TABLE OF CONTENTS
1. Executive Summary 1
2. Introduction 5
2.1. Technology in Electric Utilities 6
2.2. Importance of Grid Modernization Roadmap 7
2.3. Drivers of Grid Modernization 7
3. Pakistan’s Power Sector Policies & Institutional Arrangements 10
3.1. Institutional Arrangements 10
3.1.1. Generation Sector 10
3.1.2. Transmission Sector 10
3.1.3. Distribution Sector 10
3.1.4. Alternate Energy Development Board (AEDB) 10
3.1.5. Private Power Infrastructure Board (PPIB) 10
3.1.6. Power Information Technology Company (PITC) 10
3.1.7. National Energy Efficiency & Conservation Authority (NEECA) 10
3.1.8. Power Planning & Monitoring Company (PPMC) 10
3.1.9. Central Power Purchasing Agency (CPPA) 10
3.2 National Plans & Power Policies in Pakistan 13
3.2.1 National Electricity Policy (NEP) 2021 13
3.2.2 National Electricity Plan 13
3.2.3 Integrated Generation Capacity Expansion Plan (IGCEP) 2022 14
3.2.4 Microgrid Regulations 2022 15
3.2.5 Alternate & Renewable Energy Policy 2019 16
3.2.6 Fast Track Solar PV Initiatives 2022 16
i. Substitution Of Expensive Imported Fossil Fuels with Solar PV Energy 16
ii. Solar PV Generation On 11 kV Feeders 16
iii. Solarization Of Public Sector Buildings 17
3.2.7 National Electric Vehicle Policy (NEVP) 2020 17
3.2.8 Pakistan Cloud First Policy 2022 17
3.2.9 Competitive Trading Bilateral Contract Market (CTBCM) 18
4. Methodology for Roadmap Formulation 20
4.1. Step Wise Methodology Adopted 21
4.1.1 Step 1 - Initiation: 21

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 MEPCO ROADMAP – TABLE OF CONTENTS

4.1.2 Step 2 - Creating Baseline, Targets and Challenges 22

4.1.3 Step 3 – Recommend Solutions and Actions 22
4.1.4 Step 4 - Develop Roadmap: Prioritize Solutions & Actions 22
4.1.5 Step 5 - Visualize, Monitoring / Performance Metrics 23
4.1.6 Step 6 - Close out 23
5. MEPCO Baseline 24
5.1 MEPCO Operation Circles 24
5.2 MEPCO Power Network Assets 26
5.3 Existing Business model of MEPCO 26
5.3.1 Distribution Margin 27
5.4 Existing and Future Demand Growth Trends of MEPCO 28
5.5 Consumer Types and Quantification 30
5.6 Grid Connected Renewable Energy 31
5.6.1 Distributed Generation (DG) 31
5.6.2 Mid-sized Distributed Solar PV 33
5.6.3 Utility Scale Renewable Energy Power Plant 33
5.7 Performance of MEPCO 33
5.7.1 T&D Losses 33
5.7.2. SAIFI 34
5.7.3. SAIDI 34
5.7.4. Voltage Profile 34
5.7.5. Frequency 34
5.7.6. Load Shedding 34
5.7.7. Others: 35
5.8 Overloading position in MEPCO 35
5.9 Un electrified area in MEPCO Territory 36
5.10 MEPCO Institutional Governance 37
5.11 MEPCO Existing & Non-Existing Functionalities 39
5.12 MEPCO Existing Modernization Interventions 42
5.12.1 D - SCADA 42
5.12.2 Advanced Metering Infrastructure (AMI) 42
5.12.3 Market Implementation & Regulatory Affair Department (MIRAD) 44
5.13 Challenges Faced by MEPCO 45
5.13.1 Technical Challenges 46

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 MEPCO ROADMAP – TABLE OF CONTENTS

5.13.1.1 T&D / AT&C Losses 46

5.13.1.2 Increase in RE Penetration 46
5.13.1.3 Integrating Physical Assets Operational Technology (OT) With 46
Information Technology (IT)
5.13.1.4 Communication Infrastructure for Data Acquisition 47
5.13.1.5 Ageing & Expansion of Grid Infrastructure 48
5.13.1.6 Data Management and Cyber Security 48
5.13.2 Operational Challenges 49
5.13.2.1 Manual to Automated Operational Processes 49
5.13.2.2 Integrated Enterprise Resource Planning 49
5.13.2.3 Real Time Diagnostics and Implementation of Asset Management 49
System
5.13.2.4 Operational Capability for Grid Connected Distributed Generation 49
5.13.3 Financial Challenges 49
5.13.4 Institutional Challenges 50
5.13.4.1 Capacity Building of Technical Resource 50
5.13.4.2 Time Based Promotions 50
5.13.4.3 Effective Functionality of MIRAD 50
5.13.4.5 Establishment of ICT Department 51
5.13.4.6 Establishment of Renewable Energy Department 51
5.14 MEPCO Baseline 51
6. Recommended Actions 56
6.1 Grid Enhancement 56
6.2 Grid Efficiency, Reliability & Resiliency 58
6.2.1 Substation Upgradation / Automation 60
1. Hardware Upgrades 61
2. Software Upgrades 62
6.2.2 Feeder Upgrade / Automation 63
1. Hardware Upgrades for Services 64
2. Software / Application / Control & Monitoring System Upgrades 65
Fault Location Isolation & Service Restoration 66
Outage Management System 67
6.2.3 Supervisory Control And Data Acquisition (SCADA) System 68
6.2.4 Distribution Management System (DMS) 70

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 MEPCO ROADMAP – TABLE OF CONTENTS

6.2.5 Energy Management System (EMS) 71

6.2.6 Distribution Transformer Monitoring System (DTMS) 72
6.2.7 Enterprise Asset Management System (EAMS) 74
6.2.8 Information & Communication Technologies (ICT) Infrastructure: 75
6.2.9 Business Suites for Energy Utilties 77
6.3 Enhanced Consumer Experience (CX) and Satisfaction Program 79
6.3.1 Advanced Metering Infrastructure (AMI) 80
6.3.2 Meter Data Management System (MDMS) 83
6.3.3 Customer Information System (CIS) 85
6.3.3.1 Consumer Engagement Activities 85
6.4 Decarbonization through Inclusion of Renewable Energy 87
6.4.1 Renewable Energy Hosting Capacity Analysis 89
6.4.1.1 Combination of Hosting Capacity Analysis with Distribution 90
Automation
6.4.2 Renewable Energy Planning, Forecasting & Analysis Tools 90
6.4.3 RE Forecasting 91
6.4.4 Developing Microgrids 92
6.4.5 Distributed Energy Resource Management (DERMS) 92
6.5 Organizational Re-Structuring 94
6.5.1 Establishment of Renewable Energy Department 94
6.5.2 Establishment of ICT Department 95
6.5.3 Dedicated Cloud Services 98
6.5.4 Cloud Computing Service 99
6.5.5 Social Media Marketing Department 100
6.6 Capacity Building / Smart Workforce 102
6.7 Regulatory & Policy Support 106
6.7.1 Policy support for Innovative Business Model (Additional Revenue Streams) 106
6.7.2 Policy Support for Privatization / Provincialization of the Organization 108
6.7.3 Policy support for Tariff Re structuring 108
6.7.3.1 Tariff for Consumers 108
6.7.3.2 Tariff for Distributed Generators 109
6.7.4 Policy /Regulatory support for CTBCM -MIRAD 110
6.7.5 Addressing the Role of Unions 112
6.8. Electric Vehicle (EV) Grid Readiness 112

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 MEPCO ROADMAP – TABLE OF CONTENTS

6.8.1 Role of Power Distribution Company in Promotion of EV 113

6.8.1.1 Provision of Continuous Electricity 113
6.8.1.2 Upgradation of Grid for Integration of Charging Station 113
6.8.1.3 Optimal Placement of EV Charging Infrastructure 114
6.8.1.4 Advanced Planning / EV Penetration Roadmap 114
6.8.1.5 Development of Policies, Tariff Structure and Regulations 115
7. Roadmap for MEPCO 115
7.1. Roadmap Strategy 115
Level 0: Zero Automation 115
Level 1: Substation Automation 115
Level 2: Feeder Automation 115
Level 3: Integrated Automation 115
Level 4: Renewable Energy Integration 116
Level 5: Advanced Analytics and Control 116
7.2. Vision 116
7.3. Horizon 116
7.4. Roadmap Phases and RE Targets 117
7.5. Roadmap Program Areas 118
7.6. Roadmap Strategic Targets 119
7.7. Impact of Grid Modernization 122
7.8. Priority of Actions 124
7.9. Implementation Strategy for MEPCO 128
7.9.1 Implementation Strategy Priority Level 1-5 129
7.9.2 Implementation Strategy Priority Level 6-10 138
7.9.3 Implementation Strategy Priority Level 10-15 148
7.9.4 Implementation Strategy Priority Level 15 and onwards 151
7.10 Depiction of Roadmap 156
8. Performance & Reliability Metrics of Roadmap 157
8.0 Performance Metrics 157
8.1 Distribution Automation (DA) Metrics 158
8.2 Customer Engagement Metrics 160
8.3 Capacity Building Metrics 162
8.4 Advanced Metering Infrastructure Metrics 163
8.5 Reliability Metrics 164

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 MEPCO ROADMAP – TABLE OF CONTENTS

8.5.1 SAIFI & SAIDI 164

8.5.1.1. System Average Interruption Frequency Index 165
8.5.1.2. System Average Interruption Duration Index 166
8.5.2. Improvements in SAIFI & SAIDI through recommended actions 167
8.5.3. SAIFI SAIDI Targets 170
8.6 Energy Loss Reduction 171
8.6.1. Reduction in AT&C losses through modern interventions 172
8.6.2. AT&C Loss Reduction targets 173
8.7 Reporting of Metrics of Roadmap 174
9. Financial Estimation & Models 176
9.1 Financial Estimates of Initiatives 176
9.2 Modern Business Financing Models for Electric Utilities 178
9.2.1 Public-Private Partnerships (PPPs) 178
9.2.2 Green Bonds 179
9.2.3 Asset Recycling 180
9.2.4 Revenue Sharing 182
9.2.5 Energy Performance Contracting 182
9.2.6 Community Investment Funds 183
9.2.7 Revolving Loan Funds 183
9.2.8 Solution as a Service (SaaS) 183
9.2.9 Platform as a Service (PaaS) 183
9.2.10 Infrastructure-as-a-Service (IaaS) 184
10. References 185

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 MEPCO ROADMAP – LIST OF FIGURES

List of Figures
Description
Figure 2.1: Pearl Street Station
Figure 2.2: Targets of a conventional utility
Figure 3.1: Institutional Arrangements of Power Sector of Pakistan
Figure 3.2: Depiction of source wise Indicative Generation capacity from 2023 till 2031
Figure 4.1: Flow Chart of Roadmap Formulation Steps
Figure 5.1: MEPCO Circles / Geographical Service Area
Figure 5.2: Operation Circles of MEPCO Distribution Network
Figure 5.3: Tariff Structure
Figure 5.4: Investment and Upgradation Circle of a Utility
Figure 5.5: MEPCO Seasonal Load Profile
Figure 5.5A: Forecasted Demand till 2031
Figure 5.6: Increase in consumer base of MEPCO for last five years
Figure 5.7: Increase in Distributed Generation Exported Energy in MEPCO
Figure 5.8: MEPCO Organogram
Figure 5.9: MEPCO LIGHT mobile application screenshot
Figure 5.10: MEPCO Overall architecture for the AMI solution
Figure 5.11: CTBCM Mechanism
Figure 5.12: Data Communication Network in a typical power distribution utility
Figure 5.13: Data Sources within an Electric Power Utility
Figure 5.14: MEPCO Baseline
Figure 6.1: Recommended Action for MEPCO through 8 Program Areas
Figure 6.2: Two parts of Distribution Automation
Figure 6.3: Substation Automation Architecture
Figure 6.4: Conceptual Diagram of Distribution Feeder Network
Figure 6.5: Two Areas supplied by two distribution substations connected through sectionalizer
Figure 6.6: Difference in Restoration time of conventional and automated feeder
Figure 6.6A: OMS - Typical Outage Management Process in event of emergency
Figure 6.7: High level conceptual diagram of SCADA
Figure 6.8: Typical connectivity till RTU within Substation
Figure 6.9: Connectivity with Station Bus & Process Bus of a substation
Figure 6.10: Oversight on distribution system activities through DMS
Figure 6.11: Power Flows in Conventional and Modern Distribution Grids
Figure 6.12: Enterprise Asset Management
Figure 6.13: Oracle EAM Dashboard View

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 MEPCO ROADMAP – LIST OF FIGURES

Figure 6.14: Distribution Automation Communication Network Conceptual Diagram

Figure 6.15: Core Business Processes managed through ERP
Figure 6.16: DEWA’s SAP ERP Journey
Figure 6.17: Neighborhood Area Network (NAN), Field Area Network (FAN) & Wide Area Network (WAN)
Figure 6.18: Connectivity of Smart Meters through NAN to Data Center
Figure 6.19: AMI Architecture (From Meter to Cash) mentioning technologies for data transfer
Figure 6.20: MDMS at the heart of Utility’s functioning
Figure 6.21: Heat Map of a Distribution Feeder Hosting Capacity Analysis
Figure 6.22: High Level representation of DERMS and its connectivity with other applications
Figure 6.23: Proposed HR model for RE Department
Figure 6.24: Pros & Cons of Cloud & On Prem Solutions
Figure 6.25: Annual Rate of Data Intake from Various Applications
Figure 6.26: Use of social media for Informing Customers about Outage
Figure 6.27: Use of social media for Informing Customers about weather alert
Figure 6.28: Flow of User Data Monetization
Figure 6.29: Comparison of Weighted Average Tariff with actually determined tariff
Figure 6.30: Responsibilities in EV Charging Infrastructure
Figure 6.31: EV Penetration at different points of the Distribution Network
Figure 7.1: Program Areas of Roadmap
Figure 7.2: Sensors installed at different locations of the distribution grid
Figure 7.3: SCADA hierarchy
Figure 7.4: Data Sources in a Distribution Network
Figure 7.5: Proposed Communication Framework for MEPCO
Figure 7.6: Schematic Diagram of Distributed Generation resources connection to WAN through FAN
Figure 7.7: Distribution Management System (DMS)
Figure 7.8: News on Protest of Labour Union
Figure 7.9: Roadmap MEPCO
Figure 8.0: Metrics for gauging progress on roadmap
Figure 8.1: Types of outages
Figure 8.2: MEPCO SAIFI numbers
Figure 8.3: MEPCO SAIDI numbers
Figure 8.4: automated switching before and after fault occurrence
Figure 8.5: FLISR Details in 5 American Utilities
Figure 8.6: Percentage of Customer Minute Interruptions caused by different categories of distribution grid
equipment
Figure 8.7.: Flowchart of reporting mechanism of Roadmap

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 MEPCO ROADMAP – LIST OF TABLES

List of Tables
Description
Table3.1: Existing Vs Planned Capacity Additions
Table 4.1: Methodologies for Roadmap adopted by renowned global agencies
Table 5.1: Overview of MEPCO Distribution System parameters and assets
Table 5.2: MEPCO Annual Energy Sale, Peak Demand and Peak Demand Growth Rate
Table 5.3: Consumer wise consumption in GWh
Table 5.4: Annual Energy Sale and Peak Demand of MEPCO
Table 5.5: Details of MEPCO connected Net Metered Distributed Generation
Table 5.6: Monthly T&D Losses of MEPCO
Table 5.7: Overloaded substations (Overloading Criteria = >85%) – existing and estimation
Table 5.8: Overloaded substations (Overloading Criteria = > 100%) – existing and estimation
Table 5.9: Unelectrified Villages around MEPCO Service Territory
Table 5.10: MEPCO Existing Functionalities Status
Table 5.11: MEPCO Existing Grid Modernization Initiatives
Table 6.1: Summary of 7th STG Project of MEPCO
Table 6.2: Grid Stability Issues and Required Solutions
Table 6.3: Forecasted Renewable Energy Connected to MEPCO Network
Table 6.4: Capacity Building Training Programs
Table 6.5: MEPCO MIRAD Positions
Table 7.1: RE Penetration Phases
Table 7.2: Aligning Strategic targets with Program areas
Table 7.3: Mapping Recommended Actions with Grid Modernization Level
Table 7.4: Impacts and Actions effecting the impact
Table 7.5: Association Score based on relationship strength
Table 7.6: Recommended Action Prioritization Matrix
Table 7.7: Recommended Action sorted priority wise
Table 7.8: Expansion Plan MEPCO HT & LT Networks
Table 7.9: Rehabilitation of HT & LT Networks
Table 7.10: No. of Distribution Transformers and consumers in MEPCO
Table 7.11: Circle wise No of consumers and distribution transformers of MEPCO
Table 7.12: Circle Wise Distribution Transformers and duration of DTMS implementation
Table 7.13: Circle wise consumers of MEPCO and duration for smart meter deployment
Table 7.14: Details of Substations of MEPCO - Circle wise Grid and SCADA implementation duration
Table 8.1: Substation Automation completion in Percentage
Table 8.2: Feeder Automation completion in Percentage
Table 8.3: Targeted Periodic Social Media Interaction
Table 8.4: Customer Engagement Program Targeted Completion
Table 8.5: Capacity Building Training completion metrics
Table 8.6: SAIFI &SAIDI Targets for MEPCO
Table 8.7: MEPCO T&D Losses in terms of percentage last 5 years
Table 8.8: Percentage of Recovery of billing amount of MEPCO
Table 8.9: AT&C Loss reduction targets
Table 9.1: Financial Estimates

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 MEPCO ROADMAP – LIST OF ABBREVIATIONS

List of Abbreviations
ADB Asian Development Bank
ADMS Advanced Distribution Management System
AEDB Alternative Energy Development Board
AMI Advanced Metering Infrastructure
ARE Alternative & Renewable Energy
ATC Aggregated Technical and Commercial
BCU Bay Control Unit
BESS Battery Energy Storage System
CIS Customer Information System
CEO Chief Executive Officer
CPPA Central Power Purchasing Agency
CTBCM Competitive Trading Bilateral Contract Market
CX Customer Experience
DCC Distribution Control Center
DERMS Distributed Energy Resources Management System
DERs Distributed Energy Resources
DG Distribution Generation
DISCO Distribution Company
DM Distribution Margin
DMS Document Management System
DT Distribution Transformer
DTMS Distribution Transformer Monitoring System
EDEIP Electricity Distribution Efficiency Improvement Project
EAMS Enterprise Asset Management System
EMS Energy Management System
EPRI Electric Power Research Institute
ERP Enterprise Resource Planning
EV Electric Vehicle
FAN Field Area Network
FAT Factory Acceptance Test
FLISR Fault location, isolation, and service restoration
GENCO Generation Companies
GHG Greenhouse Gas
GIS Geographic Infromation System
GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit
GW Gigawatt
GWh Gigawatt hours
HCA Hosting Capacity Analysis
HMI Human Machine Interface
HV High Voltage
IEA International Energy Agency
IaaS Infrastructure as a Service
ICT Information & Communication Technology
IT Information Technology
IEC International Electrotechnical Commission
IED intelligent electronic device
MEPCO Multan Electric Power Company

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 MEPCO ROADMAP – LIST OF ABBREVIATIONS

IEEE Institute of Electrical and Electronics Engineers

IGCEP Indicative Generation Capacity Expansion Plan
IHD In-Home Display
IPP Independant Power Producer
kV Kilovolt
kVA Kilovolt-ampere
kW Kilowatt.
kWh Kilowatt-hour
LCOE Levelized Cost of Energy
LTE Long Term Evolution
LV Low Voltage
MDMS Meter Data Management System
MG Microgrid Regulation
MoE Ministry of Energy
PD Power Division
MIRAD Market Implementation and Regulatory Affairs Department
MV Medium Voltage
MVA Megavolt Ampere
MW Megawatt
NAN Neighbourhood Area Network
NEECA The National Energy Efficiency & Conservation Authority
NEP National Energy Policy
NEVP National Electric Vehicle Policy
NTDC National Transmission and Despatch Company
NEPRA National Electric Power Regulatory Authority
OMS Outage Management System
OT Operational Technology
PaaS Platform as a Service
PITC Power Information Technology Company
PPA Power Purchase Agreements
PPIB Private Power Infrastructure Board
PCFP Pakistan Cloud First Policy
PITC Power Information Technology Company
PPMC Power Planning and Monitoring Company
PV Photovoltaics
RE Renewable Energy
REEE Renewable Energy and Energy Efficiency
RTU Remote Terminal Unit
SA Substation Automation
SaaS Software as a Service
SAIDI System Average Interruption Frequency Index
SAIFI System Average Interruption Duration Index
SCADA Supervisory Control and Data Acquisition
SNL Sandia National Laboratories
STG Secondary Transmission Lines & Grid
TOU Time of Use
VRE Variable Renewable Energy
VVO Volt/VAR optimization
WAMS Wide Area Management Sys
WAN Wide Area Network

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 MEPCO ROADMAP – LIST OF ABBREVIATIONS

WAPDA Water and Power Development Authority

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 MEPCO ROADMAP – CHAPTER 1: EXECUTIVE SUMMARY

1. EXECUTIVE SUMMARY
Pakistan's power distribution sector faces many challenges, including aging infrastructure
stemming from lacking investments and technical as well as operational inefficiencies of state-
owned-distribution companies, which put the goal of achieving and sustaining economic growth
and reducing carbon emissions at risk. The government has taken steps to address these issues by
investing in new power generation and transmission facilities and upgrading transmission and
distribution circuits. The 2021 National Electricity Policy (NEP) furthermore tasks DISCOs to
prepare strategic roadmaps to improve their performance.
Being one of the largest DISCOs in terms of customers, the Multan electric power company
(MEPCO) is distributing electrical energy in central Pakistan in the most populated province
Punjab. The service territory of MEPCO includes metropolitan cities as well as offgrid
mountainous terrains. In this light, the MEPCO strategic roadmap is a major milestone to
overcome challenges in the distribution sector in the whole country. The presented roadmap is not
just a plan, instead it represents the intention of an organization to fundamentally shift towards
modernization in its utility business. It is the tipping point of the transition to serve its customer
continuously and reliably using state of the art technologies.
In line with the NEP 2021, and in particular with the requirements of Article 5.3.5, the roadmap
presents a disciplined and integrated approach to using innovative control and monitoring
technologies for overcoming challenges which MEPCO has been facing over the last couple of
decades.
The roadmap is based on the International Energy Agency’s (IEA) approach to create smart grid
technology roadmaps. A steering committee has been established to determine scope, boundaries
and vision of the roadmap. A baseline was developed based on publicly available information on
existing interventions, as well as on internal data from MEPCO. Based on these initial steps,
recommendations for actions were identified and prioritized, and a performance monitoring
methodology has been developed. The roadmap covers a 10-years timeline starting from 2023
and is aligned with RE penetration targets stemming from the IGCEP:

Phase 1: Phase 2: Phase 3:

5% RE penetration 10% RE penetration >10% RE penetration

2023 2027 2030 2032

The recommended actions for MEPCO are prioritized using a prioritization matrix, assessing the
impact of the actions in terms of their potential to improve efficiency, electricity service reliability,
RE integration, demand response and revenue generation.
Financial estimates for the actions can vary depending on the scope and scale of the program, as
well as the specific technologies and infrastructure upgrades involved. The exact financial
estimates for proposed actions under this roadmap will depend on a range of factors, including the
specific goals and objectives of the modernization effort, the financing methodology for the
projects, the implementation methodology, type of technology, and the regulatory environment in

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 MEPCO ROADMAP – CHAPTER 1: EXECUTIVE SUMMARY

which the utility operates. Nevertheless, an indicative financial estimation has been conducted
and added to the evaluation.
The roadmap addresses actions which are categorized into 8 Program Areas (PA):

PA3 PA7
PA1 PA5
Enhanced Policy and
Grid Organizational
Customer Regulatory
Enhancement Restructuring
Experience Support

PA4
PA2 PA6 PA8
Decarbonization
Grid Efficiency Capacity EV Readiness of
through RE
& Reliability Building Grid
Integration

PA1 - Grid Enhancement focuses on enhancing the existing infrastructure of the distribution grid
of MEPCO to improve the reliability and stability of the grid and reduce technical losses. To ensure
that future power demand is met and energy is supplied to consumers, MEPCO will need to build
new substations and sub transmission networks.
PA2 - Grid Efficiency & Reliability aims to improve the efficiency and self-healing capacity of
the distribution grid of MEPCO. This program targets to automate the distribution network through
substation and feeder automation projects.
PA3 - Enhanced Customer Experience program area focuses on improving customer service by
providing reliable and uninterrupted power supply, improving complaint handling mechanisms,
and enhancing communication with customers. Deployment of AMI and a dedicated Customer
information system (CIS) are integral parts of this program area.
PA4 - Decarbonization through RE Integration focuses on integrating renewable energy sources
into the grid to reduce carbon emissions and improve the sustainability of the sector. MEPCO
needs to take appropriate measures such as hosting capacity analysis to ensure that it is aware of
optimal connection nodes within its distribution system. Furthermore, for planning, forecasting
and technical analysis, software tools are required.
PA5 - Organizational Restructuring focuses on establishment of new departments for facing
upcoming challenges and tackling them by taking proactive approach. Departments such as ICT,
RE and Social Media Management shall be created within MEPCO. Under this program area
Business Suite shall be enhanced to cover other core functional business processes of MEPCO.

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 MEPCO ROADMAP – CHAPTER 1: EXECUTIVE SUMMARY

PA6- Capacity Building aims to improve the skills and knowledge of the workforce by providing
training and development programs, thereby improving the overall performance of the sector.
Especially due to the formation and inclusion of new departments and technologies like ICT and
RE, capacity building programs have vital importance.
PA7 - Policy and Regulatory Support is designed to support the implementation of necessary
policies and regulations to encourage MEPCO towards innovative business models and makes a
case for privatization or provincialization of MEPCO and other DISCOs.
PA8 - EV Readiness of Grid aims to prepare the grid for the adoption of electric vehicles by
installing charging infrastructure and upgrading the distribution system to handle increased
demand.

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 MEPCO ROADMAP – CHAPTER 1: EXECUTIVE SUMMARY

PA4
PA3 PA7
PA1 PA2 PA6 PA5 PA8
Enhanced Decarbonization Policy and
Grid Grid Efficiency Capacity Organizational EV Readiness
Customer through RE Regulatory
Enhancement & Reliability Building Restructuring of Grid
Experience Integration Support

PA3-A1
$$$ $$

PA6-A1
MDMS $ $$ $$ $$

PA4-A1
PA1-A1

CB on ICT

PA5-A1

PA7-A1
Constructing New$ Actions

PA8-A1
Hosting Innovative
Substations ICT Department Supporting EV $

PA2-A7 PA2-A6 PA2-A5

$ Business Model

PA2-A2 PA2-A1
$$ Capacity Analysis
Phase 1 $$
VVO Sensors /Field
Consumer Smart $$
Readiness

PA3-A3 PA3-A2
$
Extensions / $$ $$ $
PA1-A2

PA6-A2

PA4-A2
Meters

PA7-A2
PA5-A2
Remodelling / CB on RE Distributed Privatization /
2023 - 2026 Augmentation FLISR
$$
SCADA
$$ Energy RE Department Provincialization
$$ Transformer Smart $$ Management
Constructing New $
PA1-A3

$$ $

PA6-A3

PA4-A3
Distribution $ Meters
5% RE penetration RE Planning , $$

PA7-A3
PA5-A3
$$ CB on ERP Social Media Role of Unions
PA2-A3

Feeders Sectionalizers, $$ GIS Forecasting &

Department
$$ Analysis Tools

PA3-A5 PA3-A4
Reclosers Customer $
CB on Customer

PA6-A4
Information System $$ $$ $

PA4-A4
PA2-A9 PA2-A8
$$ Engagement /

PA7-A4
PA5-A4
Microgrids
PA2-A4

Communication $$$ DMS / EMS $ Dedicated Cloud $ MIRAD / CTBCM

$$ SMM
Infrastructure $ Customer
$
Phase 2 Engagement

PA6-A5
$$ CB on Safety $
DTMS Programs Operations $$

PA7-A5
PA5-A5
$ Tariff
Business Suites $ Restructuring
2027 - 2029 $

PA6-A6
CB on Cyber
Security
10% RE penetration
$

PA6-A7
CB on Leadership

PA6-A8
Phase 3 CB on AMI

$
2030 - 2032

PA6-A9
CB on Energy
Markets

> 10% RE penetration

4
 MEPCO ROADMAP – CHAPTER 2: INTRODUCTION

2. Introduction
The United States National Academy of Engineering in the year 2000 had selected the provision
of electricity (electrification) via electricity grid / distribution infrastructure as the best engineering
achievement of the century. It is no surprise that the electric grid infrastructure is one of the most
critical due to its overlapping functionality with other important infrastructures. Since the birth of
the electric utility in 1882, when the world’s first electric station in Pearl Street New York was put
into operation, electric utilities have continuously faced various technical, operational and
commercial challenges. Utilities across the world have gone through major physical
transformation in terms of expansion for catering to the ever-increasing need of electricity.

1.
Figure 2.1: Pearl Street Station: Thomas Edison in September 1882 achieved his vision of a full-scale central power
station with a system of conductors to distribute electricity to end-users in the high-profile business district in New
York City. Source: U.S. Department of Energy

The traditional grid was built over a century ago. The traditional power grid is a network of
transmission lines, substations, transformers, and more that delivers electricity from the power
plant to consumers in unidirectional way. Advances in control and communication technology
permitted the automatic or semi-automatic and remote operation of distribution equipment and
facilities that in the past could only be operated manually. With the pressure on utilities for
universal access to electricity, the advent of cheaper renewable energy source like solar PV and
wind as well as rise in digitalization technologies, utilities have transformed themselves into
modernized service providers. By utilizing local resources as fuel and modern electronic devices
for integrating them into existing grid for control and operations, the modern power distribution
utilities are engaged in efficient consumer management and two-way energy controls.

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 MEPCO ROADMAP – CHAPTER 2: INTRODUCTION

Figure 2.2: Targets of a conventional utility

By making their customers aware of the demand and supply situation, power distribution utilities
are now better equipped to make informed decisions and carry out Demand side management.
Electric utilities worldwide are committing to 100% renewable targets. The targets are designed to
decarbonize the electric utility sector to avert irreversible climate change. Throughout the world,
the electric utility sector is undergoing a fundamental transformation of its infrastructure to
overcome the present challenges faced by the sector. Since the electric utility system of a power
supply system is the closest one to the customer, its failures affect customer service more directly
than, for example, failures on the transmission and generating systems, which usually do not cause
customer service interruptions.
Unfortunately, Pakistan’s Distribution sector is cramped with several complex challenges since
their unbundling from Water and Power Development Authority (WAPDA). Lack of investment
in the upgradation/ expansion/ maintenance led to the deterioration of existing dated transmission
and distribution infrastructure. This aggravates power shortages and unreliability in supplies.
Issues such as increasing distribution losses, unreliable electricity supply and power outages due
to a system and financial constraints, and non-recovery of revenue lead to below-par performance
of electricity distribution companies. As a result, the power sector is under stress which eventually
contributes to circular debt. These losses hinder any sort of sizeable investment for grid expansion
and modernization initiatives. It is often argued that “yesterday’s power system paradigm might
not meet the demands of the future”. The question is what technology and reforms measures
need to be taken in order to transform these power distribution utilities into profit making utilities
enabling them to re-invest in their infrastructure?

2.1. Technology in Electric Utilities:

Use of technology impacts electric distribution systems significantly and sometimes more than
any other part of the electric power grid. At many electric utilities, the operation of the electric
distribution system is being transformed from mostly manual, paper-driven business processes
through the introduction of electronic, computer-assisted decision making. In developing

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countries, modernizing the distribution grid promises to benefit the operation of electric
distribution utilities in many and various ways. These benefits include improved operational
efficiency (reduced losses, lower energy consumption, and so on), reduced electrical demand
during peak load periods, better overall service reliability, and ability to accommodate additional
distributed generating resources without adversely impacting overall power quality. Benefits of
distribution grid modernization also include improved asset utilization (allowing operators to
“squeeze” more capacity out of existing assets) and workforce productivity improvement. These
benefits can provide more than enough monetary gain for electric utility stakeholders in developing
countries to offset the cost of grid modernization. Some of these core smart grid benefits may be
achieved by electric distribution utilities that have not, as yet, advanced very far in their process
of grid modernization. For example, lowering the voltage set point on an existing
electromechanical voltage regulator can reduce electrical demand and improve the overall
efficiency of the distribution system.

2.2. Importance of Grid Modernization Roadmap:

Three fundamental benefits for modernizing a legacy grid infrastructure are:
i. To increase the efficiency of grid operations and to reduce losses,
ii. To improve system reliability and security,
iii. To better adapt renewable energy resources (distributed or utility scale)
Utilities structure their vision of a smart grid around specific challenges. Some of the important
objectives are improving reliability, quick restoration of power to reduce revenue loss, improving
revenue collection, and reducing losses and integration and control of renewable energy.
Grid modernization is a conceptual goal whose achievement requires continuous grid upgrades
through the use of conventional and advanced digital technologies. Better monitoring, protection,
and control of the grid will in turn enable the delivery of electricity services in a more efficient,
reliable, and sustainable manner.
A key element of the successful deployment of a technology initiative, such as grid modernization,
is the development of a strategic road map. A roadmap (i) brings the interest of stakeholders into
a succinct plan, (ii) sets a vision, (iii) identifies technology needs, (iv) supports better investment
decisions, and (v) provides a timeline for achieving goals.
However, the development of a roadmap is an evolutionary process. Roadmaps must be reviewed
and updated regularly to meet changes in requirements, reflect advancements in technology,
correlate with workforce development, reflect time constraints, and harmonize with budgetary
constraints. Thus, roadmap has important significance in channelizing efforts to achieve the target
of grid upgrades.
2.3. Drivers of Grid Modernization:
Any kind of electric distribution utility develops their roadmaps around a certain set of drivers.
Developed countries which have already achieved a higher level of modernization emphasize on

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real time control for demand side management, integrating the renewable energy and advanced
distribution management through informed decision making through data analytics. In contrast,
developing countries place more importance on basic drivers such as reduced load shedding,
increased revenue collection, improved voltage profile and reduces losses. However, with
advancement in renewable energy especially solar PV roof top through net metered distributed
generation, the integration of renewable at MV and LV level has gained much weight. This has
caused utilities in developing countries to revisit their grid modernization strategy for effective
monitoring and control of the new RE technologies in their network.
Some of the key drivers are listed below:

Technical Operational Organizational

• Constraints for • Significant increases in • Improve enterprise
network/grid energy demand solution coordination
improvements • Demand (Load) • Enabling customer
• Integration of response & participation
renewable energy management • Improve revenue
• Micro grid • Automate / Digitize collection
developments business process • Environmental
• Integration of • Improve power system compliance
distributed energy restoration • Regulatory
resource • New technology compliance
• Concerns with aging advancements • New/improved
infrastructure • Increase in electric and services for customers
• Better asset hybrid vehicles
utilization/ Asset • Reducing human
Management factors/error
• Power quality • Workforce
improvement Optimization
• Reducing technical • Reducing operating &
losses maintenance costs
• Reliability • Energy efficiency
improvements
• Enhanced network
resiliency

This document will develop a strategic roadmap for one of the ten power distribution utility of
Pakistan. Multan electric power company (MEPCO) is responsible for supplying continuous
electricity to the Central Punjab province of Pakistan. The document shall present Pakistan Power
Sector policies in section 3. The current technology situation as well as distribution grid parameters
of MEPCO will be presented in section 4. This section will also form the basis of MEPCO’s
baselines which will be as a starting point for development of the roadmap. Section 5 will define
the methodology adopted for formulating the roadmap. Section 6 will chalk down all
recommended technological and other interventions which are required to be conducted at

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MEPCO. These recommended measures will be placed in several program areas. Subsequently,
section 7 will develop the roadmap by introducing the levels of grid modernization and assigning
these to each planned project activity. This section will also provide the vision statement and the
horizon of MEPCO’s grid modernization roadmap. Section 8 will define the performance metrics
in gauging the implementation of the roadmap. In the end Section 9 will present high level financial
estimations and business models which can be adopted by MEPCO.

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& INSTITUTIONAL ARRANGEMENTS

3. Pakistan’s Power Sector Policies & Institutional Arrangements

Any country’s power sector is composed of three sub sectors i.e., Generation, Transmission and
Distribution. Government of Pakistan is centrally controlling the sector through its Ministry of
Energy (MoE), Power Division. The National Electric Power Regulatory Authority (NEPRA) is
fulfilling the role of regulator. While Central Power Purchasing Agency (CPPA) is purchasing the
power on behalf of the Distribution companies.
3.1. Institutional Arrangements:
3.1.1. Generation Sector:
The generation sector comprises of several power plants. Some power plants are government
owned while others are independent power generators owned by private sector (better known
as IPPs).
3.1.2. Transmission Sector:
The transmission sector consists of a single National Transmission Company which is National
Transmission and Desptach company (NTDC). The regulator has allowed the provincial
governments to establish their own provincial transmission companies as well for transmission
of power within provincial territory.
3.1.3. Distribution Sector:
Ten (10) distribution companies have been established for distribution of power to the
consumers. The names of distribution companies are listed below:
1. Lahore Electric Supply Company (LESCO)
2. Gujranwala Electric Power Company (GEPCO)
3. Faisalabad Electric Supply Company (FESCO)
4. Islamabad Electric Supply Company (IESCO)
5. Multan Electric Power Company (MEPCO)
6. Peshawar Electric Power Company (PESCO)
7. Hyderabad Electric Supply Company (HESCO)
8. Quetta Electric Supply Company (QESCO)
9. Sukkur Electric Power Company (SEPCO)
10. Tribal Electric Supply Company (TESCO)
3.1.4. Alternate Energy Development Board (AEDB)
The agency was established with a mission to introduce Alternative and Renewable Energies
(AREs). AEDB is the sole representing agency of the Federal Government that was established
in May 2003 with the main objective to facilitate, promote and encourage development of RE
in Pakistan and with a mission to introduce AREs at an accelerated rate.

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& INSTITUTIONAL ARRANGEMENTS

3.1.5. Private Power Infrastructure Board (PPIB)

Private Power and Infrastructure Board (PPIB) was created in 1994 as a "One-Window
Facilitator" on behalf of the Government of Pakistan (GoP) to promote private investments in
power sector. The role of PPIB has been further expanded by the GoP by allowing it to facilitate
public sector power and related infrastructure projects in IPP mode.
3.1.6. Power Information Technology Company (PITC)
PITC objectives are to deal with the development of an integrated assets management model
for power distribution companies, implementation of ERP (Enterprise Resource Planning),
installation of Automatic Metering Infrastructure (AMI), smart grid and SCADA system in
DISCOs.

3.1.7. National Energy Efficiency & Conservation Authority (NEECA)

A body created with the aim of starting, encouraging, and coordinating all effective energy
conservation and efficient use of energy across all economic sectors. NEECA is an authority
established under the Ministry of Energy (Power Division) and serves as a federal focal agency
mandated for initiating, catalyzing and coordinating all energy conservation activities in
different sectors of economy. The authority to provide for establishment of institutions and
enunciation of mechanism and procedures to provide for effective conservation and efficient
use of energy.

3.1.8. Power Planning & Monitoring Company (PPMC)

PPMC is mandated to provide policy and technical support to the Ministry of Energy (Power
Division) Government of Pakistan for integrated planning of the Pakistan power sector, for
effectively monitoring and oversight of the distribution companies.
3.1.9. Central Power Purchasing Agency (CPPA):
In the single buyer market, the primary role of CPPA is to purchase electricity on behalf of
DISCOs as per their aggregated demand projection and in accordance with the applicable
power policies approved from time to time. However, with the latest transition towards the
power market, CPPA now operates as a market operator. Thus, CPPA now will collect
payments from the DISCOs and perform market settlement to the market participants based on
their sold energy or mismatch, if any.

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& INSTITUTIONAL ARRANGEMENTS

Overall Institutional Arrangement Diagrams:

IPPs WAPDA

Private Sector SPPs/CPPs PPMC

KE NTDC/CPPA

NEPRA (Regulator) GENCOs

Government of Pakistan
Ministry of Energy
DISCOs
(Power Division)

AEDB

Public Sector PPIB

PITC

NEECA

Pakistan Atomic KANUPP &

Energy Commission CHASHNUPP
Figure 3.1: Institutional Arrangements of Power Sector of Pakistan

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& INSTITUTIONAL ARRANGEMENTS

3.2 National Plans & Power Policies in Pakistan:

3.2.1 National Electricity Policy (NEP) 2021:
The National Electricity Policy identifies the major goals sought to be achieved for the power
sector, and in this respect, provides policy directions. It also provides the key guiding principles
to develop subservient frameworks that will steer the decision making in the power sector to
achieve identified goals. However, plans for implementation or specific operational instructions
have not been prescribed, which shall be prepared by the Government in the form of periodic
National Electricity Plans. Such plans may also provide guidelines for specific initiatives for a
particular subsector / segment of the power sector. Salient features with respect to Distribution
Sector are enlisted below:
• Improve efficiency in the T&D system operations by reducing losses and improvement in
collection, demand side management.
• Transparency through digitalization of processes.
• Ensuring cost reflective tariff in the T&D sector.
• Financial viability of the T&D sector.
• Decarbonization of the distribution sector.
• Reformation or restructuring of distribution companies to achieve targets.
• Development of Strategic Roadmaps of each distribution company mentioning
interventions for improvement of corporate governance, technical capabilities, safety, and
commercial performance.
• Exploration of different financing and investment options for expansion of distribution
networks.
• publicly available the forecasts, transmission and distribution plans and information
regarding network constraints
• SCADA and other associated systems which are necessary to integrate a higher share of
renewable energy sources in the generation mix will be upgraded.
• Uniformity in consumer tariff through direct / indirect subsidies.
• Privatization of DISCOs

3.2.2 National Electricity Plan:

The National Electricity Plan 2022-2026 was drafted for the implementation of National
Electricity Policy 2021 in true letter and spirit. The Plan covers various aspects of the power
sector. It also mentions the necessary reforms and interventions required in the Distribution
sector to revamp it and increase its financial healthiness. Some salient features in reference to
Distribution sector are listed below:
• It requires the development of a Strategic Roadmap for all DISCOs.
• Deployment of SCADA
• Deployment of Smart Meter and Advanced Metering Infrastructure
• The NE Plan also calls for completion of GIS mapping and business process automation.

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& INSTITUTIONAL ARRANGEMENTS

• The NE Plan states that the Government will continue to maintain and notify a uniform
tariff for all consumers of Last Resort Suppliers, (i.e., DISCOs) and that the same shall be
applicable for existing DISCOs even after privatization in any mode.
• The NE Plan states that decentralized induction of renewable energy sources shall be
promoted to the extent feasible, against the centralized utility-scale procurements.
• Ministry of Energy to constitute a committee to assist individual entities to develop / update
standardized ICT plan.
• Encourage demand side management strategy.
3.2.3 Integrated Generation Capacity Expansion Plan (IGCEP) 2022:
The IGCEP is a revolving plan to be updated yearly to account for any change in generation
technologies trends, governmental policies, progress/priorities of different projects etc. The data
modelling and generation optimization exercise is based on the existing and future generation
power plants, existing policy framework, existing contractual obligations, natural resource
allocations, latest-generation technologies, Grid Code provisions and the assumptions approved
by the Cabinet Committee on Energy (CCoE) of Pakistan. The objective of this plan is to
identify and provide the least cost generation expansion plan to cater to long-term load growth
forecast and reserve requirements. The plan highlights generation additions by capacity and
fuel type along with commissioning dates for ten years. It provides a good indication to the
transmission and distribution companies for preparing their respective infrastructure
enhancement plans. NTDC prepares the IGCEP each year as per regulatory requirement
mentioned in the grid code.
As per the most recent approved IGCEP versions, following is the planned capacity addition of
Renewable Energy by 2030-31:
Table3.1: Existing Vs Planned Capacity Additions

Year 2023 Year 2030-31

Installed Capacity 43,198 MW Installed Capacity 68,667 MW
Peak Demand 28,425 MW Peak Demand 41,338 MW
Energy Demand 153TWh Energy Demand 228 TWh
Solar PV 630MW Solar PV 8564 MW
Wind 2000 MW Wind 4827 MW
Net Metering 747MW Net Metering 3330 MW
Source: IGCEP /AEDB
The Net Metered Distributed Capacity is capped at 370MW per year. However, since IGCEP is
an iterative generation plan, this capacity may vary depending upon national policies, energy
requirements and market trends.

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 MEPCO ROADMAP – CHAPTER 3: PAKISTAN’S POWER SECTOR POLICIES
& INSTITUTIONAL ARRANGEMENTS

Figure 3.2: Depiction of source wise Indicative Generation capacity from 2023 till 2031
Source: IGCEP

It is worth mentioning that IGCEP doesn’t cover RE targets for each DISCO of Pakistan
independently. The same must be forecasted based on Net Metering trends and plans of the
respective DISCO itself. The RE targets of MEPCO are explained in section 6 and 7.
3.2.4 Microgrid Regulations 2022:
The microgrid regulations are placed to encourage the electrification of un electrified areas
across Pakistan through public or private investment. Through these regulations a micro grid
can be developed using indigenous renewable energy or any other resource to power the rural
un electrified areas. Such areas where the distribution company network is yet to be reached.
Therefore, this is an area of threat as well as an opportunity for the distribution company.
The following are some important items in MG regulation with reference to Distribution
company.
• The Micro grid should serve an unserved market.
unserved market" means a service territory of the host distribution company which is:
i. not served by the host distribution company at the time of the application for a
license under these regulations.
ii. outside five kilometers on either side and tail end points of existing distribution
facilities of the host distribution company; and
iii. where the host distribution company’s service is not projected to extend under its
investment plan.
• The maximum installed capacity of a microgrid can be up to 5MW.

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& INSTITUTIONAL ARRANGEMENTS

• In case the distribution company’s grid is extended to the area served by micro grid , then
there is a possibility that the distribution company may acquire the microgrid.
3.2.5 Alternate & Renewable Energy Policy 2019
After the discontinuation of the Renewable Energy policy 2006, Alternate & Renewable Energy
Policy 2019 is launched and is currently active. The policy looks to enhance the development
of existing and future RE technologies by creating a conducive environment. Salient features
are mentioned below:
• The policy targets that at least 20% of its on-grid generation capacity as ARE technologies
by 2025 and 30% by 2030 (20X25 and 30X30 target).
• Policy encourages all RE technologies like wind, solar, biogas, geothermal etc., and also
encourages battery storage systems as well as hybrid technologies.
• Policy covers both on grid and off grid ARE projects.
• Policy also encourages net metered distributed generation.
• Procurement through auctions
• The policy envisages that the direct purchaser shall be DISCO(s).
• Displacement of expensive energy through cheaper ARE to reduce the average generation
cost.
• Procurement shall be on a least cost basis.
3.2.6 Fast Track Solar PV Initiatives 2022:
In order to ensure the Government of Pakistan's (GOP) policy objectives of energy security,
affordability of electricity, environmental protection, and sustainable development, the GOP
envisions to deploy solar power on a fast-track basis. For this purpose, it has issued Solar PV
initiatives guidelines consisting of three initiatives. Brief explanation is given below:
i. Substitution Of Expensive Imported Fossil Fuels with Solar PV Energy
Appropriate capacity for Solar PV generation will be procured based on CPPA
identification of imported fuel based thermal power plants whose fuel can be
substituted with solar energy during the day according to the technical and contractual
limitations.
Under this initiative the planned installation capacity is 6000MW in blocks of
600MW each.
ii. Solar PV Generation On 11 kV Feeders
Decentralized, medium-scale Solar PV power can contribute cost efficiently to
alleviate some of these problems by feeding directly into the medium-voltage (MV)
network, thereby improving the local losses and voltage situation. Furthermore, the
injection of Solar PV power into the MV network would provide cheap electricity into
the national grid without any augmentation or major upgrade of the grid infrastructure.
Accordingly, Solar PV projects of suitable capacity upto maximum 4MW will be

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& INSTITUTIONAL ARRANGEMENTS

procured through competitive bidding process at 11 kV feeder level. Under this

initiative, GOP intends to solarize approximately 2000 distribution MV feeders. The
total capacity to be installed under this initiative is 2000MW.
iii. Solarization Of Public Sector Buildings
Solarization of public sector buildings is a well-recognized concept particularly in
developing world that helps in meeting certain portion of electricity load through clean
solar energy technology, reduce electricity bills of public offices and relieve electricity
utilities/ distribution companies from long-term dues besides encouraging Solar PV
deployment on small to medium size buildings of common households and
commercial buildings. Under this initiative, the GOP plans to solarize buildings
with a total capacity of 2000MW.

3.2.7 National Electric Vehicle Policy (NEVP) 2020:

Government of Pakistan introduced its first ever National Electric Vehicle Policy (NEVP) for
various vehicular segments in 2020. Encouraging the use of EVs has manifold benefits for the
power sector. However, it also brings stress on the aging electric infrastructure. Additionally,
use of EVs charged from Renewable Energy sources help in alleviating the climate crisis which
Pakistan’s most of the metropolitan cities are observing in recent years. Nonetheless, some
salient features of the EV policy are mentioned below.
• Electric vehicles shall make up 30% of all the passenger vehicle and heavy-duty truck sales
by 2030, and 90% by 2040.
• At least one DC fast-charging station every 10 square kilometers in all major cities and
every 15–30 kilometers on all motorways

3.2.8 Pakistan Cloud First Policy 2022:

Cloud computing offers a wide variety of potential benefits and opportunities: reduced costs,
improved responsiveness to citizens’ needs, increased transparency, environmental benefits &
reduced carbon footprint, efficient management, optimization of resources and enhanced public
service delivery. Cloud computing fundamentally changes how organizations use Information
and Communications Technologies (ICT) in a more efficient way, therefore, all necessary steps
are required to be taken to ensure a seamless cloud adoption process, providing the full
advantage of the potential and benefits of cloud computing. Ministry of Information Technology
published Pakistan Cloud First Policy (PCFP) to encourage cloud adoption across Pakistan.
This policy aims to guide and empower organizations to transition to cloud-based
solutions. It constitutes an integral part to support the GOP’s efforts to promote mass adoption
of emerging digital technologies, accelerate digital transformation and development of
innovative applications.
Some salient features are below:

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& INSTITUTIONAL ARRANGEMENTS

• Non allowance of fragmented data centers in public entities

• Prioritizing cloud adoption
• To provide a coherent approach to cloud adoption across Pakistan, provide ease of doing
business
• To enhance efficient governance
• To provide transparency and accountability
• To accelerate digital transformation
• To optimize resource usage through shared services compared to underutilized on prem data
centers.
• To reduce energy consumption, waste and carbon emissions through cloud computing.

3.2.9 Competitive Trading Bilateral Contract Market (CTBCM):

In November 2020, Pakistan's National Electric Power Regulatory Authority (NEPRA)
approved the implementation of a Competitive Trading Bilateral Contracts Market (CTBCM)
model. The Competitive Trading Bilateral Contracts Market (CTBCM) is a type of energy
trading platform where electricity buyers and sellers can enter into bilateral contracts to buy and
sell electricity at a mutually agreed price. This market allows for more flexibility in terms of
energy procurement, as buyers and sellers can negotiate their own terms and prices, rather than
relying on a fixed rate or a centralized power exchange.
The aim of this model is to open up the Wholesale Electricity Market in Pakistan, providing
choice to bulk power consumers with a load of 1MW or above to purchase electric power from
either their Distribution Companies (DISCOs) or a competitive supplier of their choice. In order
to facilitate successful commercial operations of the CTBCM, NEPRA formulated several
regulations, including licensing regulations for the Market Operator, Electric Power Trader, and
Electric Power Supplier, as well as consumer eligibility criteria and registration regulations.
In May 2022, NEPRA granted a market operator license and approved the market commercial
code (MCC). The approved MCC will end the single buyer regime and require DISCOs to
procure power through centrally organized auctions run by an Independent Auction
Administrator (IAA). Bulk power consumers will have the option to procure power from their
DISCOs or a competitive supplier. Additionally, market sales on a merchant basis will be
allowed for interested generation plants, including those retiring from the legacy generation
fleet or connected with the national grid as captive generating plants.
The implementation of the CTBCM is expected to improve the governance of the wholesale
market through institutional reforms, restructuring, and automation of business processes, and
capacity building of professionals. The creation of Market Implementation and Regulatory
Affairs Departments (MIRADs) in all distribution companies is one of the institutional reforms.
By requiring DISCOs to actively plan, procure and enter into power procurement contracts
bilaterally, they are expected to improve their discipline, capacity, and bankability, ultimately
eliminating the need for sovereign guarantees for procurement.

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& INSTITUTIONAL ARRANGEMENTS

The implementation of the CTBCM in Pakistan is expected to provide greater competition,

efficiency, and transparency in the energy sector. This model will also encourage investment
and promote energy security by diversifying energy procurement sources, mitigating the risk of
energy shortages, and reducing reliance on a single source of energy supply.
With CTBCM framework in place, MEPCO (as well as all other DISCOs) through its MIRAD
face huge challenges in making the implementation of multi buyer market successful.

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 MEPCO ROADMAP – CHAPTER 4: METHODOLOGY FOR ROADMAP FORMULATION

4. Methodology for Roadmap Formulation

Building a roadmap is a key step towards channelizing efforts to achieve a larger goal. It is
visualization of strategic initiatives which shall be undertaken in a well-defined prioritization.
Specifically, in case of power distribution utilities, roadmaps are pathways to ensure energy
reliability, security and efficiency for the betterment of consumers. A clear and well-defined
methodology is critical in developing a successful roadmap. Several international organizations
have prepared guides for planners to make an effective roadmap.
Sandia National Laboratories (SNL), USA in 1997 published the fundamentals of technology
roadmap. In 2012, the Electric Power Research Institute (EPRI) published its methodology for the
development of smart grid road maps. International Energy Agency (IEA) has developed a
methodology for its members for the development of a road map and used this methodology to
develop a smart grid technology road map for IEA member countries.
Brief features of the methodology of each agency are tabulated.
Table 4.1: Methodologies for Roadmap adopted by renowned global agencies

SNL EPRI IEA

Phase 1 Defining the Vision Planning and preparation
Preliminary activities - Vision is defined as to what – Establishing a Steering
consisting of three elements: objectives are required by Committee
– Satisfying essential the utility. – Determining the scope,
conditions (for example, boundaries, and
confirm the need for a road Identifying the Requirement implementation approach
map) -This includes identifying the – Developing energy,
– Providing needs and interactions of environmental, and economic
leadership/sponsorship various actors (persons, data to establish a baseline
– Defining the scope and applications, processes, and
boundaries for the technology so on). Vision
road map -It also includes logical – Identifying long-term goals
interfaces with the relevant and objectives
Phase 2 attributes such as timing, – Analyzing future scenarios
Development of the volume, and so on for energy and environment
technology road map:
– Identifying the focus of the Assessing and Selecting the Road map development
road map Technology – - Identifying and prioritizing
– Identifying critical system -Deploy a ranking mechanism needed technologies, polices,
requirements and targets for technonoly intervention and timelines
– Specifying major for each kind – - Developing a road map
technology areas -Select technologies based on document, launch strategy,
– Specifying drivers and top ranking and tracking system
targets – - Conducting review cycles
– Identifying alternatives Planning
– Recommending technology - Establish a planning process
alternatives using fish bone where tail is

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 MEPCO ROADMAP – CHAPTER 4: METHODOLOGY FOR ROADMAP FORMULATION

– Creating a road map report current situation and head is– - Assessing potential
target. contribution of technologies
Phase 3 - Scales are steps to reach the to future goals
Follow-up activities: target.
– Critique and validation of -Establishing the roadmapRoad map implementation and
road map revision
– Developing an Implementing the Roadmap – Reassessing priorities and
implementation plan Reporting and timelines as progress is made
– Review and update. implementation mechanism and new trends emerge
Performance metrics – Tracking changes as the
road map is implemented
Source: Fundamentals of Technology Roadmapping by SNL 1997 Marie L. Garcia, Olin H. Bray, EPRI Smart Grid
Roadmap Guide Book 2012, Technology Roadmap A guide to development and implementation IEA.

In view of the above three methodologies, the subject roadmap is prepared by following IEA
roadmap methodology processes as it is more suitable to the needs and viability of the MEPCO.
The goal of a technology roadmap is to optimize the deployment of a specific technology or group
of technologies. A roadmap is simply a strategy, merely a plan that describes the steps to be taken
to achieve the stated and agreed goals on a defined schedule. It helps to identify the technical,
policy, legal, financial, market and organizational barriers that lie before these goals, and the range
of known solutions to overcome them. The subject roadmap is mainly focusing on technical
aspects and high-level financial aspects of MEPCO.
The process of developing a roadmap is as important as the final document itself: it represents
consensus among the full range of stakeholders consulted in its development, who have considered
potential barriers to deployment, sought early solutions and, in some cases, avoided anticipated
issues altogether.
4.1. Step Wise Methodology Adopted
Step wise Methodology has been adopted which is inspired by IEA. The methodology has been
explained below.
4.1.1 Step 1 - Initiation
The most critical part of road mapping occurs at this stage. Roadmap must have a clear
purpose, stakeholder(s) support, and buy-in from all stakeholders to be effective and later to
implementation. The success of a smart grid roadmap in distribution sector is based on early
planning, foresight, establishing a commonly “owned” vision, a full understanding of the
distribution challenges and opportunities, commitment to public and private stakeholders and
ongoing evaluation and reports on the progress. Following two main sub-steps are considered
under roadmap initiation process.

a. Establish a Steering Committee consisting of experts from the utility and consultants.
b. Determine and agree on the objectives and scope of the roadmap.
c. Kick off meeting and Data collection.

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 MEPCO ROADMAP – CHAPTER 4: METHODOLOGY FOR ROADMAP FORMULATION

Under this step, Kick-off Meeting (KoM) with all required stakeholders and request for
information (RFI) documents had been shared with MEPCO to collect the required
information about the existing system, policies, and (master) plans which will form the basis
for the development of smart grid roadmap.
a. MEPCO has shared initial data after the collection exercise initiated.
b. After completion of data collection exercise, introductory workshop had been conducted
together with MEPCO for:
i. Identify MEPCO’s priorities and requirements.
ii. Agree on MEPCO’s expectations from the roadmap.
iii. Collection of missing data.
iv. To get feedback on MEPCO’s ongoing projects and initiatives.
v. Establish liaison between responsible focus group within MEPCO relevant
departments and other stakeholders.
Following the workshop, a feedback and suggestion worksheet which was shared, which was
shared with MEPCO. The worksheet helped map out key goals, processes, and next steps for
the roadmap. In addition to the above input, several reports, policies, plans and other
documents related to the scope of the roadmap were reviewed to support the research and fill
gaps that we missed as we moved into Step 3.
4.1.2 Step 2 - Creating Baseline, Targets and Challenges
The baseline represents existing MEPCO grid status, including areas of focus and potential
initiatives in renewable energy and technology that are already under implementation. The
targets are created by making a list of insights from national policies and ARE (Alternative
and Renewable Energies)-plans inputs, other reports and grouping them into high-level goals.
Subsequently the “challenges” are bundled from issues and problems which MEPCO is
currently facing. We have chalked down MEPCO’s potential problems from various inputs
and consolidated them into a single list consisting of types of challenges. The list will give a
better understanding of the main challenges of MEPCO, and it will help us to prepare MEPCO
specific solutions.
The timeline (horizon) of the roadmap shall be decided in this step. The horizon shall be in
years. The horizon is kept at 10 years from 2023 till 2032.
4.1.3 Step 3 – Recommend solutions and actions
Referring to the engineering best practices and implemented solutions by developed countries,
various solutions and actions are identified, explained and recommended to mitigate the
challenges identified in earlier step and to support MEPCO in achieving their goals in
compliance with the Ministry of Energy (MoE) objectives and other authorities’ requirements.
4.1.4 Step 4 - Develop Roadmap: Prioritize Solutions & Actions
This step will create the level of grid modernizations and formulate the roadmap. This step
will identify the highest-priority actions that will be mapped to the closer time horizons on

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 MEPCO ROADMAP – CHAPTER 4: METHODOLOGY FOR ROADMAP FORMULATION

the roadmap. There are several methods to prioritize and determine which actions have the
highest importance. A prioritization matrix is developed keeping in view of the impact and a
score is given based on the strength of the relationship of each action with the impact. The
score defines the priority of implementation.

4.1.5 Step 5 - Visualize, Monitoring / Performance Metrics

The roadmap will be for specific time-periods which will be coordinated with the stakeholders
and in accordance with controlling authority timeframe. Performance metrics is developed for
guidance of MEPCO to monitor the progress of roadmap implementation.
4.1.6 Step 6 - Close out
Final report, draft version to be submitted to MEPCO, the comments and feedback will be
reviewed considering the targets defined and shall be incorporated into the final roadmap,
which shall be handed over to MEPCO and Ministry of Energy, followed by a workshop for
final discussion and handover.

Step 3:
Step 2:
Recommend
Step 1: Initiation Baseline,Targets &
Solutions and
Challenges
actions

Step 4: Develop
Step 5:
Step 6: Close Out Roadmap: Priortize
Visualize,Monitor
Solutions & Actions

Figure 4.1: Flow Chart of Roadmap Formulation Steps

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

5. MEPCO Baseline
MEPCO, the Multan Electric Power Company, was established in 1998 as a result of the
corporatization of the energy sector in Pakistan. It took over the properties, assets, and liabilities
of the defunct Multan Area Electricity Board, including grid stations and transmission lines in
the region. Post unbundling of WAPDA, MEPCO is responsible for supply of reliable provision
of electricity to its consumer in the districts of Sahiwal, Vehari, Bahawalnagar, Multan,
Bahawalpur, Rahimyar Khan, Layyah and Dera Ghazi Khan of the province of Punjab. During
FY 22-23, MEPCO supplied 14,978 GWh to almost 7.9 million consumers living in its service
area.

Figure 5.1: MEPCO Circles / Geographical Service Area

Source: MEPCO

5.1 MEPCO Operation Circles

For effective and efficient management of its distribution network, MEPCO has divided its
service area territory into circles. Furthermore, each circle is then decomposed into 3-4 divisions.
The details of circles and divisions is provided in figure below.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

MEPCO
Distribution
Network
Management

Dera Ghazi Khan Bahawalnagar

Multan Circle Vehari Circle Bahawalpur Circle Sahiwal Circle Rahim Yar Khan Muzaffargarh Khanewal
Rawalpindi Circle

Figure 5.2: OperationCircles of MEPCO Distribution Network

Source: MEPCO

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

5.2 MEPCO Power Network Assets

MEPCO manages its 132kV (HV), 11kV (MV) & 400V/230V (LV) power distribution network
in its service territory for reliable supply of electricity to its consumers. The details of its
distribution network assets are provided below:
Table 5.1: Overview of MEPCO Distribution System parameters and assets
MEPCO Power System Overview
No of grid stations (total) 141
a) 132 kV grid stations 123
b) 66 kV grid stations 6
c) Consumers grid stations 12
Transformers & Feeders
Power transformers (No.) 317
Power transformers installed capacity (MVA) 9,018
Transmission lines (km) 4741
HV (High Voltage) lines (km) 82,047
LV (Low Voltage) lines (km) 50,557
11kV feeders (No.) 1,726
Distribution transformers (No.) 230,081
Distribution transformation Capacity (MVA) 13,368
Source: MEPCO Technical Data

All the 132kV grid stations are conventional outdoor air insulated grid stations. The 132kV
transmission lines are overhead transmission lines and the 11kV feeders emanating from the grid
stations are also overhead air insulated.

5.3 Existing Business model of MEPCO

Pakistan’s power sector is a regulated market since the unbundling of WAPDA and creation of
the power regulator (NEPRA). The price of electricity unit supplied /delivered is set by the
regulator based on a certain rule for design of tariff and keeping in view the policy of the
Government of Pakistan. All three segments of the power sector i.e., Generation, Transmission
and Distribution have to follow the tariff approved by the regulator for each of these segments.
NEPRA under the Regulation of Generation, Transmission & Distribution of Electric Power Act,
1997 (NEPRA Act) prepared Tariff Standards and Procedure Rules which NEPRA published in
1998 (Tariff Rules). The tariff for each of the licensee of the regulator i.e., generation,
transmission and distribution sector is being approved by the regulator in order to recover all
prudently incurred costs to meet with the demonstrative needs of its customers including the
setting of performance parameters for each of licensee.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

5.3.1 Distribution Margin

NEPRA determines the tariff for all the generation, transmission and distribution companies; yet
the sum of costs of all the three kinds of tariffs is recovered from the consumers through the
distribution companies. The tariff of the distribution company is its Distribution Margin,
however beside that margin, the generation cost (of generation companies) as well as the
wheeling charges (for transmission company) are also recovered in the bills generated by the
distribution companies.
The distribution margin is the economic rent which the firm gets for operating the distribution
network. The margin consists of operation and maintenance expenses, depreciation charges, and
return on rate base, further adjustments are made for any income earned by the firm. As per
NEPRA Guidelines for determination of consumer end tariff, “Distribution Margin” means the
component of revenue requirement comprising of operations & maintenance cost, return on rate
base, depreciation, taxes, other regulatory cost including other income determined or approved
by the Authority for running the distribution business.
Operation and maintenance expenses, including wage and salaries, are the largest component of a
distribution network’s cost (about 90 %) excluding transfer prices for generation and
transmission companies. Distribution networks are public owned companies and jobs are
sanctioned for various pay scales historically with employees entitled to post-retirement benefits.
The regulator allows costs for salaries and wages based on past audited figures with the
adjustment of annual pay increases of public employees and the impact of hiring on vacant
positions, with very little allowance for new staff hiring, particularly with non-technical contract
employees.
According to regulation rules, sufficient tariffs/DMs should be allowed to generate a reasonable
investment in technology to maintain the system and improve the reliability of the electricity
supply. Therefore, an increase in the supply of electric units to the end consumers will have a
positive effect on the balance sheet of the distribution company as it will ensure an overall gain
of distribution margin.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

Figure 5.3: Tariff Structure

Source: Costing and Tariff Setting in Power Sector of Pakistan by Abid Lodhi

Overall end consumer tariff to be collected by distribution company per unit consumption of
electric energy is following:
Tariff end consumer (PKR/kWh) = PPP + DM
PPP = Power Purchase Price (PKR/kWh)
DM = Distribution Margin (PKR/kWh)
Thus ideally, a distribution company would intend that the future demand for energy
consumption increases at a steady pace in future years ensuring a healthy revenue generation for
it to invest in its infrastructure for expanding it to new consumers and making it reliable for
continuous supply of energy.

Increase in Invest in Grid

Distribution Infrastructure for
Margin Modernization

Continuous &
and Growth
Reliable
of Electrical
Supply of
Network
Electricity

Increase in
Revenue

Figure 5.4: Investment and Upgradation Circle of a Utility

5.4 Existing and Future Demand Growth Trends of MEPCO

Different seasons bring different consumption patterns for a power Distribution company. For
instance, during summers, when the temperature rises, customers tend to use more air
conditioning and other cooling appliances, which leads to a spike in energy demand. Similarly,
during winters, when the temperature drops, customers tend to use more heating appliances,
which again leads to an increase in energy demand. However, in case of Pakistan (and MEPCO),
we tend to use natural gas as a means for space heating due to which electricity demand during

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

winters decreases considerably. Figure 5.5 presents MEPCO seasonal load profile for FY 2021-
22 which shows the same trend.

Figure 5.5: MEPCO Seasonal Load Profile

Over the years, Pakistan has seen a continuous increase in demand of electricity. The same trend
is also depicted in the demand growth of MEPCO. During recent past MEPCO has witnessed
growth in energy sale as well as peak demand.

Table 5.2: MEPCO Annual Energy Sale, Peak Demand and Peak Demand Growth Rate
Energy Sale Peak Demand Peak Demand
Year Growth Rate
GWh MW %
2017-18 15,853 3436 18.73
2018-19 16,309 3696 7.57
2019-20 16,381 3854 4.28
2020-21 17,466 4136 7.32
2021-22 19202 4426 7.01
2022-23 16732 4418 2.67
Source: MEPCO
An in-depth analysis of consumer consumption reveals that although domestic consumption of
energy increased during the past five-year period, commercial and industrial consumption shows
a declining trend which is a worry for MEPCO.

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Table 5.3: Consumer wise consumption in GWh

Year Domestic Commercial Industrial Agricultural

2018-19 8914.59 945.93 3011.39 2879.97

2019-20 9469.57 903.24 2509.25 2916.57
2020-21 9825.38 980.72 2860.58 3201.47
2021-22 10243.68 1077.49 3460.11 3736.51
2022-23 9100 1081 2999 2906
Source: NEPRA SOI 2022 / MEPCO

Table 5.4: Annual Forecasted Energy Sale and Peak Demand of MEPCO
Peak
Year Demand
(GWh) (MW)

2023-24 16983 5023

2024-25 17477 5209
2025-26 18003 5416
2026-27 18643 5625
Source: MEPCO

Figure 5.5A: Forecasted Demand till 2031

Source: MEPCO

For a FY 2023 peak demand of 4544 MW supplying approximately 20TWh of energy, MEPCO
has a HV (132kV/11kV) transformation capacity of 9018MVA while for distribution
transformer(11kV/0.4kV) it has approximately 13368MVA capacity. Considering an increase of
peak demand upto 6039MW and energy sale of 29TWh by 2027, it is safe to say that MEPCO
requires considerable expansion/upgradation of its current assets.

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5.5 Consumer Types and Quantification

Historical figures of number of consumers within MEPCO’s jurisdiction for the respective years
are given in Figure. These figures show the total number of consumers in all consumer
categories, i.e. Domestic, Commercial, Small industries, Medium & Large industries, Public
Lighting, Bulk and Agriculture. Figure 5.6 shows a regular increase in the number of customers
each year. This shows an average growth of 5.2% of consumers per annum.
• 2025 Number of Customers (estimated): with 8 % growth scenario about 9,230,045.
• 2030 Number of Customers (estimated): with 10% growth scenario about 15,420,000.

Figure 5.6: Increase in consumer base of MEPCO for last five years

Keeping the growth rate constant at 10%, it is assumed that 15.4 million consumers will be on
MEPCO network by 2030.

5.6 Grid Connected Renewable Energy

5.6.1 Distributed Generation (DG)
MEPCO service territory is in a region of high solar radiation. This encourages domestic
consumers to install roof top solar PV on their premises and compensate for higher energy
bills by producing their own energy. With the Net metering regulations available since 2015,
it has been observed that net metered distributed generation has exponentially risen. By end
of December 2022, 767MWp has been net metered across Pakistan with 461MWp installed
in 2022.
Since the start of Net Metering Regulations by NEPRA, 6915 consumers have installed
distributed generators on their premises. The consumers are mainly domestic three phase
consumers. Brief details of the distributed generators connected to MEPCO network is
tabulated below:

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

Table 5.5: Details of MEPCO connected Net Metered Distributed Generation

No. of DG MW
Connections Capacity
Installed
Applications received by 4598 120
MEPCO
DG facilities Commissioned 4220 95
(Total)
Total Exported Units (kWh) 134,908,858
till 2023
Source: MEPCO

The year wise energy generation (export) from the distributed generation is important to
estimate the impact on the electrical network of MEPCO.

EXPORTED UNITS
YEAR DG Solar (kWh)
2023 94,663,372
2022 29,938,360
2021 8,485,770
2020 1,483,101
2019 305,921
2018 30,963
2017 1,371
2016 0
2015 0
134,908,858

Figure 5.7: Increase in Distributed Generation Exported Energy in MEPCO

Source: MEPCO

It is concluded that despite an increase in distributed generation, the percentage of energy

supplied through distributed RE in 2023 is less than 0.5% of the overall energy supplied
through MEPCO power network.

The Government of Pakistan under its Solar Initiatives 2022 has planned to solarize public
sector buildings under the control of Federal Government. Most of these buildings are
situated in Islamabad, however, some also come under the service territory of MEPCO.
Therefore, an increase in distributed generation is expected in future. The Integrated
Generation Capacity Expansion Plan (IGCEP) has kept a block of 370MW separately for the
net metered distributed generation. For the purpose of roadmap formulation, we will assume
a certain percentage of this capacity to be installed in MEPCO service territory.

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5.6.2 Mid-sized Distributed Solar PV

Additionally, Government of Pakistan has also planned to solarize 11kV feeders by injecting
upto 4MW of Solar PV power. Under this initiative between 1500 to 2000 11kV feeders
across the 10 distribution companies shall be selected and solarized to improve voltage
profile and overcome energy losses. It is assumed that atleast 10% of 11kV feeders of
MEPCO, if not more, shall be solarized. A closer look will be taken in the upcoming section.
5.6.3 Utility Scale Renewable Energy Power Plant
No utility scale power plant has been installed at MEPCOs 132kV and 11kV power
distribution network.

5.7 Performance of MEPCO

The regulator has set Performance Standard distribution Rules (PSDR) 2005 to gauge the yearly
performance of the distribution company. Every year MEPCO submits its Annual Performance
Report (APR) to the regulator. The PSDR defines the guaranteed and overall standard of
performance for the end consumers which are to be met by distribution company. a distribution
company shall be constructed, operated, controlled and maintained in a manner consistent with
the Distribution Code, Power Safety Code, Consumer Service Manual, and other applicable
documents.
In order to formulate baselines, it is very important to understand the existing situation of
MEPCO.

5.7.1 T&D Losses

The regulator allows acceptable T&D losses in each of the distribution company’s tariff
determination. MEPCO had a permissible T&D loss limit of 14.90%. However, the actual
T&D losses reported by MEPCO in its APR 2022 was 14.70% which is -0.20% breach of the
allowed limit. This is much higher as compared to other best performing DISCOs of Pakistan
(IESCO - 8.18%). It is also worth mentioning that this T&D loss of 14.70% is the average
loss over a period of one year. In depth analysis reveals a different picture and shows that
during summer months, the T&D loss is much higher than the allowed limit. This translates
to a loss of 45,413,749.61units of energy having a negative financial impact of PKR 901
million.
Table 5.6: Monthly T&D Losses of MEPCO
Month T&D Losses (%)
Target Actual Breach
July 14.9 19.97 5.07
August 14.9 17.96 3.06
September 14.9 15.26 0.36
October 14.9 6.18 -8.72
November 14.9 1.89 -13.01

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

December 14.9 11.41 -3.49

January 14.9 6.87 -8.03
February 14.9 6.11 -8.79
March 14.9 16.48 1.58
April 14.9 15.72 0.82
May 14.9 20.34 5.44
June 14.9 18 3.1
Source: DISCO Performance Evaluation

Although MEPCO recovery has been 99.73% which is much better than other DISCOs,
however, MEPCO has suffered a revenue loss of PKR 983 million for not achieving the
targeted 100% recovery rate.

5.7.2. SAIFI
As per PSDR, a distribution company shall ensure that the System Average Interruption
Frequency Index (SAIFI) of supply of power per consumer per annum does not exceed
thirteen. SAIFI is a key performance indicator which is used to gauge the performance of a
company. In short, SAIFI is the average number of times that a customer experiences an
outage during the year. MEPCO has reported a figure of 43.94.

5.7.3. SAIDI
As per PSDR, a distribution company shall ensure that the System Average Interruption
Duration Index (SAIDI) of supply of power per consumer per annum does not exceed
fourteen. SAIDI is a key point indicator used to gauge the company’s performance in terms
of the duration (minutes) of outages for which consumers suffered during the year. MEPCO
has reported a figure of 2794 minutes.

5.7.4. Voltage Profile

A distribution company shall supply power to atleast 95% of its consumers within the range
of ± 5% of the nominal voltage.

5.7.5. Frequency
A distribution company shall supply power to its consumers within the frequency range of 50
(±1%) Hz.

5.7.6. Load Shedding

MEPCO has reported an average daily load shedding of 0.6 hours in its service territory.
However, as per regulator this is far from reality as a major part of FY 22 remained under
fuel crisis due to which a continuous supply of electricity was not provided. Furthermore,
various areas of MEPCO service territory were effected due to 2022 floods.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

5.7.7. Others:
08 people have died due to occurrence of fatal injuries during the previous FY in MEPCO
region.

5.8 Overloading position in MEPCO

The overloading occurs only when load flow exceeds the designed and installed capacity of the
associated substation as per the grid-code. With reference to NEPRA state of industry 2022
report indicates that MEPCO shown increase in percentage (%) of overloaded power
transformers over last year reflecting decline in their performance.
• Thirty (30) out of three hundred twelve (312) transformers in the year 2021 to fourty six
(46) out of three hundred seventeen (317) power transformers are overloaded (above 80%
of their installation capacity) in the year 2022;
• Three hundred twenty-three (323) out of one thousand six hundred fifty two (1,652) 11kV
feeders in the year 2021 to three hundred eighteen (318) out of one thousand seven
hundred twenty six (1,726) 11 kV feeders are overloaded (above 80% of their installation
capacity) in the year 2022.
• Four Thousand one hundred fifty-seven (4,157) out of one hundred eighty seven
thousand seven hundred ninety one (187,791) DT (Distribution Transformers) in the year
2021 to six thousand seven hundred thirty two (6,732) out of two hundred twenty three
thousand nine hundred twenty two (223,922) Distribution Transformers are overloaded
(above 80% of their installation capacity) in the year 2022.

The following tables shows number of 132kV substations overload in MEPCO. Accordingly, 15
to 25% of MEPCO’s substations will be at risks unless continuous upgrades take place on time.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

Table 5.7: Overloaded substations (Overloading Criteria = >85%) – existing and estimation

Substations – Overloading Criterion = 85%

Years Number of substations MW
21-22 6 358
22-23 4 289
23-24 6 325
24-25 11 710
25-26 5 340
26-27 9 806
27-28 11 737
28-29 11 737
29-30 7 716
Source: MEPCO
Table 5.8: Overloaded substations (Overloading Criteria = > 100%) – existing and estimation

Substations – Overloading Criterion = 100%

Years Number of substations MW
22-23 1 14
23-24 3 124
24-25 3 124
25-26 4 169
26-27 4 209
27-28 9 656
28-29 10 750
29-30 4 343
30-31 7 567
Source: MEPCO
MEPCO may reduce the capital investment in grid reinforcement and upgrades by deploying
SCADA, advanced metering infrastructure, and other technologies, increasing its flexibility in
managing and operating the grid. These smart tools provide various value propositions by
helping MEPCO manage load demand, reduce peak demand, increase energy efficiencies, and
improve grid resilience and reliability.

5.9 Un electrified area in MEPCO Territory

According to NEPRA state of Industry report 2022, there are number of unelectrified areas
within MEPCO service territory. Though reasonable electrification activity has been observed
over the last five years, MEPCO needs to tap this potential and generate extra revenue.

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Table 5.9: Unelectrified Villages around MEPCO Service Territory

As on Total Number Total Villages Remaining Percentage of Total
30th of Villages Electrified Villages Electrified
June Villages
2018 37,400 30,364 7,036 81.19
2019 39,518 30,660 8,858 77.58
2020 41,579 31,858 9,721 76.62
2021 44,603 34,703 9,900 77.8
2022 48,761 35,806 12,955 73.43
Source: NEPRA SOI 2022

5.10 MEPCO Institutional Governance

MEPCO, like other DISCOs of Pakistan, has a separate Board of Directors (BOD). Thus, there is
a confusion as to whether MEPCO is a corporate business entity or a public sector organization.
In reality it is both. Business as usual and decision making is similar to any government owned
enterprise. Ministry of Energy (Power Division) has central control over the decision making of
MEPCO. The strategic decisions are issued by the Ministry of Energy (Power Division) and are
fulfilled through approval of Board of Directors by the Chief Executive Officer and subsequent
lower management hierarchy.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

MEPCO Organogram Chart

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5.11 MEPCO Existing & Non-Existing Functionalities

This section describes some major functionalities which have become a norm in most of the
modern power distribution companies around the world. Whether these functions exist in
MEPCO are also mentioned. Some of the functions exist partially while others are non-
automated. The table below provides an understanding of existing status of MEPCO.

Table 5.10: MEPCO Existing Functionalities Status

Technology Intervention Status
Automated Control and monitoring of Non-Existent
132kV Transmission Lines
132/11kV Substation Automation (within Partially Implemented - BCUs are non-existent
Substation) and only electromechanical relays are converted
to digital /numerical relays
11kV Feeder Data Acquisition & Control Automated digitized Control is Non-Existent

USAID funded Load Data Improvement Project

(LDIP) implemented metering project for 11kV
feeders across DISCOs. The export /import
energy from feeders is being displayed in galaxy
software. Galaxy provides instantaneous as well
as historic load profile information including
import and export energy consumption as well as
Power Factor (PF) for analysis and reporting. The
custodian of the data and software is PITC.

Monitoring / Control of Distributed Non-Existent

Generators connected at consumer premises
(Net Metered)
Distribution Control Center (DCC) Existent but lacks capacity building. Control
functions are being carried out manually through
telephonic instructions by regional control center.

Dedicated Renewable Energy Team / Non-Existent

Department
Smart Metering (AMI) Pilots have been implemented at small scale
however, no full scale roll out has been executed.
MEPCO strategy is to install smart meters to its
three-phase consumer first, being the major
revenue generation category and then to single
phase consumers. Total three phase consumers of

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

MEPCO are 209559 out of which 70,000 smart

meters have already been installed and remaining
are under installation GSM technology is being
used as per the requirement.

D-SCADA Non-Existent

Communication Infrastructure at 132kV Non-Existent

side
Communication Infrastructure at 11kV side Non-Existent

Demand Forecasting Tool Non-Existent / Obsolete

Weather Forecasting Tool Non-Existent

Dedicated Software tool for unified PSS-E is used for 132kV network analysis.
simulation of 132kV and 11kV network Synergi is used for 11kV network analysis.
along with RE penetration at various
voltage level No unified tool is available for simulating 132kV
and 11kV networks altogether. Furthermore, RE
generation simulation is non-existent.
GIS Mapping of HT/LT networks GIS mapping of HT (11kV) network is
completed.

Digitization of Core Business Processes / Partial ERP system implementation is ongoing.

Enterprise Resource Planning SAP ERP is implemented with following
modules:
Material Management (MM)
Human Resource Management (HRM)
Finance (FiCO)

Customer Services Management Centralized Call Center (an in-house application

customized for the DISCO’S requirement) based
on Microsoft fico server, php laravel, java etc.
established and run by PITC (Power Information
Technology Company) for all DISCO’s.
Complaints registration followed by unique ticket
with multi-layer escalation level is being
successfully run by PITC since 2018. Performance
reports based on the individual as well as team at
each hierarchy is being strictly monitored at
MEPCO head quarter level.

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

Complaints are resolved within the threshold time

decided by Ministry of Energy (Power Division)
like minimum power outage time 3.15Hrs is given
to resolve the complaint and so on 61 different
categories of complaints are being handled within
the allocated time.

Following modes are available for consumer to

initiate complaints:
▪ Voice Calls at UAN 118
▪ SMS on short code (8118)
▪ Email
▪ Web Portal (MEPCO.com.pk/complaints)
▪ Website (www.roshanpakistan.com)
▪ Mobile App (MEPCO Smart, MEPCO Light)
▪ Twitter@MEPCO_Official
▪ Khuli Katchehry
▪ E- Katchehry
▪ Walk in at Sub Division/Customer Services
Centre etc.
Regional Customer Services Center at MEPCO
Head Office
Meter Data Management System (MDMS) Dedicated MDMS at MEPCO premises is Non
Existent. However, USAID provided a
comprehensive MDMS, deployed at PITC. All
Smart Meters and AMS are being monitored
through that MDMS which is integrated with
billing system (IBS) and MEPCO Smart app.

Wok Force Management System (WFMS) Non Existent

Manual hard copy registers are being used for
work force management for field operation
purposes
Outage Management System (OMS) Non-Existent

11 kV and low voltage distribution grid protected

by protection system and relays, events recorded
and shared with operations departments manually
as per requirement.
Asset Management System (AMS) Non-Existent
For Asset inventories, completed fixed assets
Register (FAR) in MS Excel regarding annual

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

feeder wise, Grid wise additions is updated.

Energy Management System (EMS) Non-Existent
Distribution Management System (DMS) / Non-Existent
ADMS
Market Management System (MMS) Non-Existent
Distributed Energy Resource Management Non-Existent
System (DERMS)

One of the examples of above-mentioned initiatives is the mobile application. The

implementation of the application provides following information:
• Customer Portal
• Load management
• Billing details
• New connection application
• New application tracking
The snapshot of the mobile application is given in the figure below.

Figure 5.9: MEPCO LIGHT mobile application screenshot

USAID with collaboration of PITC has recently launched a Smart Mobile Application "MEPCO
Smart". Other applications like ENC AMI. CCMS have been merged into it.

5.12 MEPCO Existing Modernization Interventions

5.12.1 D - SCADA
MEPCO with support from GIZ has attended capacity building training programs for
distribution SCADA systems. However, no physical implementation is undergoing currently.

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5.12.2 Advanced Metering Infrastructure (AMI)

MEPCO with the help of USAID’s Power Distribution Program (PDP) implemented a pilot
AMI project in MEPCO as customer level. Customers for smart-meter installation were
selected on the basis of certain parameters, such as high load profiles and agricultural
context (tube-wells). Smart AMR meters, hardware / software for Meter Data Collection
(MDC), end-user interface and commissioning of an integrated Advanced Metering
Infrastructure (AMI) was carried out under the program.

Figure 5.10: MEPCO Overall architecture for the AMI solution

It should be noted that World Bank project program for Electricity Distribution & Efficiency
Improvement Project (EDEIP). EDEIP will also include implementation of distribution
monitoring system for several distribution companies (including MEPCO) in Pakistan.
5.12.3 Market Implementation & Regulatory Affair Department (MIRAD)

The market structure followed in Pakistan has been a single-buyer model in which CPPA (as
a single-buyer) purchases electricity on behalf of ex-WAPDA distribution companies
(DISCOs). In November 2020, NEPRA approved a Competitive Trading Bilateral Contract
Market (CTBCM) model that provided a roadmap for opening the Wholesale Electricity
Market of Pakistan, aiming to provide choice to the bulk power consumers (with 1MW or
above load) to purchase electric power from the DISCOs or a competitive supplier of their
choice. In order to provide an enabling regulatory framework for successful commercial
operations of Competitive Trading Bilateral Contracts Market (CTBCM), the regulator has
formulated various regulations. In May 2022, the Authority granted market operator licence
to CPPA and approved market commercial code (MCC). As per the approved Market
Commercial Code;

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i. the single buyer regime will end, and DISCOs will be procuring power through
centrally organized auctions run through the Independent Auction Administrator
(IAA),
ii. bulk power consumers (more than 1 MW load) will be given choice to procure power
either from distribution company (DISCO) or it’s competitive supplier and
iii. market sales on merchant basis will also be allowed to interested generation plants
including those retiring from legacy generation fleet or connected with the national grid
as captive generating plants.

CTBCM will tremendously improve the governance of wholesale market through

institutional reforms, restructuring and automation of business processes and intense capacity
building of professionals. It is pertinent to mention that these institutional reforms include the
creation of market implementation and regulatory affairs departments (MIRADs) in all
distribution companies. MEPCO has also established its MIRAD consisting of officials who
will oversee the market activity. By requiring MEPCO to actively plan, procure and enter
into power procurement contracts bilaterally, the results are expected to improve the
discipline, capacity and bankability of MEPCO thus ultimately doing away with sovereign
guarantees for procurement.

Figure 5.11: CTBCM Mechanism

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 MEPCO ROADMAP – CHAPTER 5: MEPCO BASELINE

The CTBCM commenced on May 31st ,2022 on trial run basis for a period of 6 months.
Under the CTBCM regime, the exclusive right for supply of electricity is to be revoked. The
MEPCO business shall be separated into two parts i.e., supply of electricity and maintaining
the wire business. The wire business shall be the exclusive right of MEPCO, while the supply
business will be competitive. The consumers above 1MW shall be free to choose their own
supplier. The metering business shall be carried out through a separate entity.
Under this model, MEPCO will face modern challenges. The challenges are of a
commercial, technical and regulatory nature.

5.13 Challenges Faced by MEPCO

Numerous challenges are being faced by Multan Electric Power Company. Although reports
show that the company has a higher recovery rate and lower percentage of T&D losses, however,
the balance sheet of the company depict a different picture. It should be noted that the electric
utility business throughout the world is considered a profitable business. It is due to this
profitability, utilities are enabled to invest their earnings to expand and modernize their grid
infrastructure in order to overcome the sustainable transition towards a cleaner future. Moreover,
the expansion and digitalization of the grid caters for newer upcoming de centralized generation
and technologies like solar, wind, biogas, electric vehicles etc. Some of the challenges which
MEPCO currently faces are listed below.
5.13.1 Technical Challenges
5.13.1.1 T&D / AT&C Losses
One of the major challenges MEPCO faces is curbing the T&D loss. Even though the
average T&D loss is slightly above the regulator allowed limit, it is observed that it
increases considerably during the summer months. Reduction in energy losses and theft is
essential in overcoming this threat to sustainability of any utility.
5.13.1.2 Increase in RE Penetration
With advancements in renewable energy technologies and decline in their prices, rapid
deployment of solar PV and wind has been observed in all sections of the energy supply
chain. Healthy solar irradiation level across MEPCO service territory has encouraged
consumers to make full use of the Net Metering Regulation since its launch in 2015. It is
foreseen that with Government of Pakistan’s Solar Initiatives, the Solar PV deployment
in distribution network will increase further. For ensuring smooth integration, MEPCO’s
current technical capability requires to increase manifold. Capacity building, forecasting
software, operations and monitoring and control methodology is required for safe
inclusion of clean energy.
5.13.1.3 Integrating Physical Assets Operational Technology (OT) With Information
Technology (IT)

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Integrating Physical Assets Operational Technology (OT) with Information Technology

(IT) poses significant challenges for a power distribution company like MEPCO. One of
the most significant challenges is the complexity of the systems and the different
technologies involved. The integration of OT and IT requires the integration of various
devices and systems that operate in different ways, and it can be challenging to ensure
that they all work together seamlessly.
Another challenge is the lack of skilled personnel with expertise in both IT and OT.
MEPCO like all distribution companies of Pakistan, typically has separate teams handling
IT and OT, and there is a significant knowledge gap between the two groups. This makes
it difficult to design and implement effective integration solutions and troubleshoot issues
that arise.
Furthermore, data security is another significant emerging challenge. Integrating OT and
IT requires sharing data between systems that have different security requirements and
protocols. This can create vulnerabilities that hackers and other malicious actors can
exploit to gain access to sensitive information or disrupt operations.
Legacy systems and equipment can also pose challenges to integration efforts. For
example, MEPCO has outdated OT systems (manual operations of isolators and other
field devices) that are not compatible with modern IT systems. Integrating these legacy
systems with newer IT systems is challenging and require significant investment in
upgrading or replacing equipment.
Additionally, integrating OT and IT requires significant investment in infrastructure and
technology. This is a major challenge for MEPCO with limited resources or competing
priorities. Moreover, the ROI of such an investment is not always clear, and the benefits
are not realized for several years.
Despite these challenges, the integration of OT and IT is critical for MEPCO to improve
operational efficiency, reduce downtime, and improve customer service. Overcoming
these challenges will require a coordinated effort between IT and OT teams, investment
in technology and infrastructure, and a focus on data.
5.13.1.4 Communication Infrastructure for Data Acquisition
A key building block is a two-way communication network that will enable any electric
distribution utility to monitor and control the performance of its electric distribution
assets from its distribution control center (DCC). Advances in control and communication
technology now permit the automatic or semi-automatic and remote operation of
distribution equipment and facilities that in the past could only be operated manually.
MEPCO lacks a two-way communication infrastructure network which is essential for
AMI, SCADA and monitoring and control of its critical power assets like power and
distribution transformer. Communication technologies encompass telephony, optical
fiber, leased lines, wireless communications, mesh radio, WiFi, and others. The building

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of a dedicated communication network is capital intensive. This is a major technical

challenge which is necessary for real time monitoring and control of MEPCOs assets.

Figure 5.12: Data Communication Network in a typical power distribution utility

Source: Thottan, Marina., Budka, Kenneth C.., Deshpande, Jayant G.. Communication Networks for Smart
Grids: Making Smart Grid Real. Germany: Springer London, 2014.

5.13.1.5 Ageing & Expansion of Grid Infrastructure

The technical details described in previous sections show that MEPCO has a power
transmission capacity of approximately 9,018MVA while the distribution transformer
capacity is 13,368. This existing capacity is for per annum energy supply of 20,000 GWh
with a peak demand of 4544MW. For meeting the forecasted energy and peak demand of
XX and 8161MW by 2031, MEPCO would need to aggressively expand its distribution
network. This includes substations, 11kV feeders, service mains, distribution
transformers and other associated assets. Planned expansion of the modern grid is a
challenging task for a cash deprived utility. MEPCO would need to ensure that all
modern interventions are catered for in advance in newer grid and feeder expansions.
5.13.1.6 Data Management and Cyber Security
Grid Modernization brings with it an enormous growth in the volume of data that must be
managed for use by an ever-growing number of utility applications. Data extends the
visibility of the grid from traditional boundaries of communication from the substations
and the utility Data and Control Centers (DCCs) to feeders, distributed generation, and
consumer locations. In order to extract the most value from this data, it is essential for
utilities to develop a data management strategy that takes into account collection,
correlation, and analysis of volumes of data from disparate data sources and conversion

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of these data into actionable information for grid management and business functions. It
also includes the cybersecurity strategy and its implementation to secure the data.
MEPCO lacks the capability of handling volumetric data coming in from various sources.
Development of on prem data base for handling of data and subsequent development of
data analytics is one of the key challenges which MEPCO faces.

Figure 5.13: Data Sources within a Electric Power Utility

Source: Thottan, Marina., Budka, Kenneth C.., Deshpande, Jayant G.. Communication Networks for Smart
Grids: Making Smart Grid Real. Germany: Springer London, 2014.

5.13.2 Operational Challenges

5.13.2.1 Manual to Automated Operational Processes
Currently manual and paper driven operational and business processes are being followed
mostly in MEPCO. In order to transform MEPCO from conventional to utility of the future,
automated operational processes need to be implemented. Commands and control of 132kV
and 11kV feeders are being carried out telephonically which are risk prone. Similarly,
Outages are recorded manually, and asset inventories are also updated manually.
5.13.2.2 Integrated Enterprise Resource Planning
Recent Gap analysis carried out in DISCOs revealed that several important utility tasks are
being carried out in silos. Enterprise Resource Planning (ERP) complete in all aspects.
Processes such as Work Force Management, Material Management, Finance, Vehicle
Management, etc. shall be implemented through ERP systems.
5.13.2.3 Real Time Diagnostics and Implementation of Asset Management System
Advance level of process maturity, moving from reactive to proactive and risk managed
maintenance. optimization and real-time collaboration with suppliers, employees and
customers is a challenge. Integration with existing GIS systems, with OT (Operational

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Technology) systems, such as SCADA and/or other sensors will help MEPCO in
transforming asset data into actionable insights.
5.13.2.4 Operational Capability for Grid Connected Distributed Generation
The existing distribution grids were not built to support decentralized energy generation,
distributed energy storage systems, or virtual power plants. The case of MEPCO is no
different. With rapidly declining RE prices and increase in overall energy tariff, a
considerable amount of roof top PV along with feeder solarization is expected to connect to
MEPCOs network. The intermittent nature of RE sources will pose huge operational
challenges to MEPCO network in managing these resources without damaging its power
distribution assets.

5.13.3 Financial Challenges

One of the major financial challenges faced by MEPCO is the issue of AT&C losses. AT&C
(Aggregate Technical and Commercial) losses refer to the total amount of electricity lost due
to technical and commercial factors such as theft, billing errors, and inefficient distribution
systems.

High AT&C losses not only lead to a decrease in revenue for MEPCO, but also result in
higher operating costs due to the need for additional investments in infrastructure and
manpower to address the losses. This puts significant strain on the financial health of
MEPCO and limits its ability to invest in critical infrastructure upgrades and other initiatives
to improve the quality and reliability of the power supply.

Furthermore, poor tariff structure results in revenue shortfalls for an electric utility, as
consumers may be discouraged from using electricity due to high prices. This can lead to a
situation where the utility is unable to recover its fixed costs and generate sufficient revenue
to meet its operational expenses. In such a scenario, the utility may resort to load shedding
or rationing of electricity, which can adversely impact the quality of life of the consumers,
especially in areas with a high demand for electricity. The same is being observed for
MEPCO.

Based on the projections and financial analysis of future revenues and expenses for the
electric utility, the MEPCO rate structure in its current form is not a sustainable financial
model. The projected change in net position will run a deficit from 2022 to 2026 if rates and
expenses remain the same. Based on these projections, the electric utility will run a negative
rate of return by the end of 2023 if the rates and expenses remain the same. To achieve
MEPCO authorized rate of return at or around 11.83% per year as allowed by the Regulator
(NEPRA), the average rate increases need to be revised as per projection 2022-2026.

5.13.4 Institutional Challenges

5.13.4.1 Capacity Building of Technical Resource

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Digitalization, Decarbonization and Decentralization of the utility energy supply chain

requires its human resource to be aware of the modern trends of global leaders in utility
business. A rigorous capacity building program of MEPCO human resource is essential for
technology transfer.
5.13.4.2 Time Based Promotions
Time-based promotions can lead to the promotion of individuals who may not have the
necessary skills, qualifications, or experience to take on new roles or responsibilities. This
can result in poor performance and decreased productivity in the organization, leading to
potential financial losses. Time-based promotions can lead to a lack of motivation and
decreased job satisfaction among employees who feel that their hard work and contributions
are not being recognized or rewarded appropriately. This can result in high turnover rates and
difficulty in retaining talented employees, which can negatively impact the organization's
performance.
Therefore, innovative mechanisms for promotion should be explored in order to encourage
employees to work eagerly and contribute towards the success of the organization.
5.13.4.3 Effective Functionality of MIRAD
Full-time deployment of human resources in MIRAD is required. Currently, it has been
observed that existing employees have been given additional duties by MIRAD. This leads to
neglect of one or both positions. Moreover, this can lead to suboptimal decision-making,
inefficiencies, and increased risk of errors or mistakes. By relying solely on existing
employees, the organization misses out on the benefits of diverse thinking and expertise from
outside sources. This can hinder the potential for growth, improvement, and adaptation to
changing circumstances. Specifically, in case of MIRAD which is responsible for successful
implementation of CTBCM framework, hiring existing employees of Distribution companies
(with no prior experience of market implementation) of Pakistan has a potential for
detracting the process of CTBCM.
Furthermore, apart from dedicated human resources for MIRAD, working guidelines and
SOPs need to be devised in order to gain the trust of suppliers under CTBCM regime. Clear
guidelines for procurement, energy balancing and monitoring will enable smooth functioning
of the CTBCM regime.
5.13.4.5 Establishment of ICT Department
MEPCOs IT department lacks the awareness and capability to deploy, manage, supervise and
analyse the data which is to be acquired from the field and other assets in its distribution
network. Developing and analysing the utility applications such as SCADA, DMS, ADMS,
OMS etc. require specific subject matter experts. Establishment of a dedicated ICT
department is one challenge where institutional change will be required within MEPCO.

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5.13.4.6 Establishment of Renewable Energy Department

With progress in installations of distributed generation across MEPCO network, the need for
establishing a Renewable Energy Department is of utmost importance. The RE department
will have all trends and logs of RE generation connected to the MEPCOs network.
Additionally, it will facilitate associated department of MEPCO in procurement, management
and operations of RE technologies.

5.14 MEPCO Baseline:

In this section MEPCOs baseline will be developed. The baseline will form the basis against
which performance will be gauged for the implementation on the roadmap developed in
subsequent section. The purpose is to develop a clear picture, for the management, regulator and
the investors, describing the current state of technology and ongoing or completed technology
measures.
It is worth emphasizing that MEPCO as part of its fundamental utility operation i.e., supply of
electric power, looks to invest in expansion of its distribution network to improve cater for more
consumers. Moreover, it looks to operate and maintain its existing physical assets to perform
safely and reliably. This Baseline section describes MEPCO’s key grid modernization initiatives
already undertaken or approved by its management to be implemented in coming years. The
focus will be mainly on the technological interventions to modernize its grid infrastructure and
not on investments related to expansion ie., building new installations.
Currently, MEPCO neither has a dedicated ongoing grid modernization program nor is it planned
in the near future. However, some interventions which are being carried out or have been
completed are following:
1. AMR pilot Project
2. Distribution Transformer Monitoring System (DTMS)
3. Enterprise Resource Planning (ERP) System
4. Distribution Feeder level Smart Metering
5. Web & Mobile Based Consumer Application – Roshan Pakistan

Table 5.11: MEPCO Existing Grid Modernization Initiatives

Intervention Details
s
Enterprise Project status: Ongoing
Resource Funding:
Planning Implementation Partners: SAP / Abacus Consulting
(ERP) Project Scope: Implementation of SAP modules for business
System process automation. MM, PS, FICO and HCM

Other Remarks: The above modules have been implemented but are
being underutilized due to one reason or the other.

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A full suite of applications for integrated

management of business processes is required.
Furthermore, an Asset Management System is also
required for the management of field devices.

Distribution Project status: Ongoing

Transformer Funding: World Bank
Monitoring Project Scope: Implementation of Transformer monitoring system
System (TMS) / Asset Performance Management System
(DTMS) (APMS) on 9,000 distribution transformers of
100/200KVA rating in MEPCO

Other Remarks: The initiative is under the World Bank’s Energy

Electricity Distribution Efficiency Improvement
Project (EDEIP). Training and capacity building is
also part of this program.

Distribution Project Status: Completed

Feeder level Funding: USAID Power Distribution Program
Smart Implementation Partners: Microtech
Metering Project Scope: Installation of Automatic Meter Reading
(AMR) devices at all incoming and
outgoing feeders of the grid stations in
all Discos across Pakistan.
Other Remarks: The project consisted of three main components:
i. the provision of smart meters
ii. the installation of headend
applications
iii. the development of a web-based
portal for monitoring of the installed
smart meters
iv.
11kV MTI (Microtech Industries) Galaxy software is a web-based application that
Feeders Data facilitates the MEPCO Distribution Control Center operator to retrieve data from
Hosting & centralized database being maintained by PITC at NOC (network operation
Software center) WAPDA house Lahore. MTI Galaxy Software Version: 20.2 (Server
Apache) accessible through web is used. It gives information about remote
disconnection/reconnection of meters and billing data export for integration with
DISCO existing utility billing systems. Key Specifications such as Load, Voltage,
Ampere, Power Factor and Phase sequence of (11 KV Feeders) history of
breakdowns and graphical position of the system.
Number of meters covered: 1500
Key specifications: data-based web applications, communication
related software’s, other meters software, database
server, incoming and outgoing servers and web
application server, Standalone integrated with

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CCMS

Data hosting Location: PITC/NOC Lahore

Communication medium: GSM

Web & Project Status: Completed

Mobile Funding:
Based Implementation Partners: PITC
Consumer Project Scope: The application has Complaint Management
Application System, Load Management System, New
– MEPCO Connection application and LMR.
Smart Other Remarks: The "MEPCO Smart" web and mobile application
is a step forward towards making electricity
consumers able to access Billing Details and
Information regarding Load Shedding Schedule and
more at their fingertips

Geographic Project Status: Completed HT Side. LT Side underway

Information Funding: Own Resources
System Project Scope: Generation of an enterprise-wide repository of the
(GIS) electric grid and feeder wise geospatial asset
information. The data in the GIS system will be in
a standard format.

To transfer MEPCO to a modern utility capable of hosting larger amounts of VRE an emphasis to
break down organizational silos by knowledge transfer, coordination of activities and budget
considerations are paramount. Currently, data generated within each business unit remains the
most siloed out of everything. There is going to be value if people do use data in their own
groups, but the full value comes from trying to develop use cases across the organization.
Connected data is always going to be more valuable to a DISCO than just big data that is siloed.
The implementation of a currently absent enhanced network management, asset management,
outage management, workforce management, SCADA and state of the art data analytics will be
key to a successful path to a modern utility.

On the ERP side either SAP modules have been implemented but a full utility suite or in SAP
terms an IS-U is non existential. These IT systems are stand alone and have no implementation
for state-of-the-art Service Oriented Architecture (SOA) or an Enterprise Service Bus (ESB)
enabling the integration and interaction of IT/OT platforms.
Although a number of smart devices are already deployed (e.g., digital meters at 11kV
substations) the potential of the data generated is not harvested and processed in a reasonable
SCADA platform. In fact, a SCADA solution has not been implemented for benefiting from the
11kV data gathered. Since a SCADA platform processing all the time series data generated from
various sensors throughout the network and also visualizing the state of the grid in real time is

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absolutely essential for all other IT/OT solutions and the anticipated target to host larger amounts
of VRE in the future.

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MEPCO BASELINE

PARTIAL AMI PARTIAL ERP SINGLE BUSINESS LARGE NO. OF

PROJECT MODEL EMPLOYEES
SYSTEM

7.9 MILLION NO SCADA SYSTEM UNAUTOMATED 90MW NET METERED

CONSUMERS FEEDERS

LACK OF
SILOED DATA High NON FLEXIBLE
COMMUNICATION
POWER FLOW
INFRASTRUCTURE T&D LOSSES
CAPABILITY

Figure 5.14: MEPCO Baseline

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 MEPCO ROADMAP – CHAPTER 6: RECOMMENDED ACTIONS

6. RECOMMENDED ACTIONS
This chapter focusses on the recommended actions for MEPCO. In this section the challenges
faced by MEPCO will be elaborated more in terms of technical language and will be grouped based
on the solutions proposed. The challenges will be technical, organizational, financial and others.
Moreover, the increase in penetration of renewable energy resources through net metering and
other initiatives poses a threat for safe operations of the field assets and requires up to date
technological solutions. The solutions proposed are based on review of available literature,
different organizational documents provided by MEPCO, trends in vogue, initiatives successfully
utilized in other power distribution utilities across the world and consultant’s own experience in
development of roadmap for other utilities.
The chapter is framed in 08 Program Areas (PA) for MEPCO. Each program area is then
decomposed into separate projects (which shall be designated by A as actions) which consist of
several interventions which are necessary to be implemented at MEPCO.

Figure 6.1: Recommended Action for MEPCO through 8 Program Areas

6.1 PA1: Grid Enhancement

Power System constraints are posing serious threats to the distribution system reliability. To cope
with the growth of electricity demand and system constraints, increased generation expansion, as
well as corresponding increases in capacity of the transmission system and the distribution
networks is urgently required. As highlighted in chapter 5 section 5.4, for a FY 2022 peak demand

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of 4544 MW supplying approximately 20TWh of energy, MEPCO has a HV (132kV/11kV)

transformation capacity of 9018MVA while for distribution transformer(11kV/0.4kV) it has
approximately 13,368MVA capacity. Considering an increase of peak demand upto 6,039MW and
energy sale of 29.5TWh by 2027, it is safe to say that MEPCO requires expansion/upgradation of
its current assets with a double percentage. Hence, grid enhancement is indispensable to remove
system constraints, increase distribution capacity for supplying electricity reliably, reduce system
losses, improve efficiency of the network, and meet the standards specified in the Grid Code.
Resultantly, sufficient power will flow into MEPCO's network which will provide reliable & stable
supply to its customers. Therefore, the program of grid enhancement is devised in this roadmap
consisting of three projects (actions) related to following:
• Construction of New Substation
• Extension, remodeling, augmentation of existing network
• New distribution feeder network (includes 132kV transmission lines and distribution
feeder)
It is worth mentioning that MEPCO STG (Secondary Transmission Lines & Grid) Project is
ongoing for enhancing its distribution network capacity. The main objectives of the project are
mentioned below:
The prime objectives of the plan are:
a. To eliminate constraints identified in the system.
b. To maintain and upgrade the existing system in accordance with NTDC Generation &
Transmission Plan.
c. To plan, design & implement system expansion to increase the capacity to cope with the
higher load demand.
d. To reduce the technical losses as per regulators given target.
e. To improve the quality of electric supply to end consumer.
f. To minimize the interruptions and attain the standard fixed by regulator.
g. To improve Sustainability, Stability, Reliability and Efficiency of the system to meet with
the goals of contingency.
Summary of STG Project of MEPCO is given in table.
Table 6.1: Summary of STG Project of MEPCO
Description Unit 2022-23 2023-24 2024-25 2025-26 2026-27 Total
New Grid Stations No. 3 3 6 8 4 24
MVA 1098
Extension /Addition No. 12 6 8 10 7 43
MVA 275
Augmentation of Power No. 6 10 8 7 9 40
Transformers MVA 80
Transmission Lines No. 11 3 15 18 24 69
km 277 54 246 339 705 1651

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Line Bays No. 7 6 16 11 9 49

Capacitor Banks No. 4 2 4 5 15

The details of all the works in STG are provided in chapter 7.

6.2 PA2: Grid Efficiency, Reliability & Resiliency:

Grid efficiency, reliability, and resiliency are essential factors for ensuring the smooth operation
of a power distribution grid. Below is a brief explanation of what each of these factors mean.

Grid Efficiency:

This refers to the ability of the power grid to deliver electricity to end-users while minimizing
losses, costs, and emissions. A more efficient grid can reduce energy waste and help to lower
electricity bills for consumers. Upgrading power electronics, implementing demand response
programs, and incorporating energy storage can all help to improve grid efficiency.

Grid Reliability:

This refers to the ability of the power grid to deliver electricity to end-users without
interruption or degradation in service. A reliable grid is essential for supporting critical
infrastructure, such as hospitals, emergency services, and data centers. Upgrading
infrastructure such as transformers, installing protective devices, and implementing advanced
control systems can help to improve grid reliability.

Grid Resiliency:

This refers to the ability of the power distribution grid to withstand and recover from
disruptions, such as extreme weather events or cyber-attacks. A resilient grid can help to
prevent power outages, limit their duration, and reduce their impact on the community.
Implementing microgrids, installing backup power systems, and enhancing cybersecurity
measures can all help to improve grid resiliency.

Achieving a balance between efficiency, reliability, and resiliency is essential for ensuring the
smooth and stable operation of a power distribution network. Upgrading infrastructure and
implementing new technologies can help to improve each of these factors, making the grid more
adaptable and better equipped to handle the demands of a modern energy system. Power
distribution companies have traditionally prioritized the upkeep of satisfactory conditions along
the distribution feeders. The objectives of electric distribution reliability within a power
distribution company include:

• Ensuring the safety of both their workforce and the general public.
• Minimizing electrical losses on the distribution system, particularly in developing countries
where high levels of technical and nontechnical losses occur.
• Protecting distribution assets from harmful electrical events, such as short circuit currents and
voltage fluctuations.

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• Maintaining voltage levels within an acceptable range (typically nominal voltage, plus or
minus 5 percent) for all customers under all loading conditions.
• Ensuring that electrical equipment is loaded well below its established thermal rating to
prevent overloading.
• Ensuring the reliability of service by limiting interruptions and their impact.

While it may seem like a win-win for a distribution company to build new substations, strengthen
existing feeders, have communication network, install new sensors, and add smart meters, there is
a hidden risk in increasing the fixed costs that must be recovered from customers, who increasingly
look elsewhere for power.
The following table shows key technical problems with reference to grid stability faced by
MEPCO and best practices solutions.
Table 6.2: Grid Stability Issues and Required Solutions
Problems Requirements
Remote measuring, monitoring & control
Overloaded Grid Assets
Planning, upgrade & reinforce
Remote measuring, monitoring &
Voltage Fluctuation control, load flow management, RE
system (equipment) specification
/standardization
Remote measuring, monitoring &
Frequency Variation control, load flow management, RE
system (equipment)
specification/standardization
Faults and Short Circuit Contribution Remote measuring, monitoring & control
Unintentional Islanding Remote measuring, monitoring & control
Forced Power Outages Remote measuring, monitoring &
control,
Load and supply management, energy
storage, energy evacuation
Unbalancing load demand Remote measuring, monitoring &
control, load and supply management

The main duty of MEPCO is to deliver electricity to its customers in a safe and dependable manner,
while ensuring affordability and adherence to funding parameters set forth by regulatory decisions.
Prior to introducing any interventions, it is important to establish certain measures that are

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necessary for upgrading and modernizing the aging electrical distribution grid and feeder
infrastructure. Some of the basic measures are listed below:
• Implementation of Substation Automation within the substation fence
• Monitoring & Control of MV/LV feeders
• Reduction in energy losses through transformers and feeders
• Digitalize & Automate Consumer meter reading process
• Remote measuring, monitoring & control of power flows across critical nodes of the
network
• Robust communication network for acquiring data from monitoring and sensing devices in
the field
• Enabling grid for catering the increase in distributed RE Generation
For sake of improving the grid efficiency, reliability and resiliency, we divide this into two parts:

Distribution
Automation

Substation
Feeder Upgrades /
Upgrades /
Automation
Automation

Figure 6.2: Two parts of Distribution Automation

MEPCO requires to take various measure in order to automate its substations and feeders.
Following sub-sections will shed light on technologies required for substation and feeder
automation. MEPCO will be required to implement these in a planned manner.
6.2.1 Substation Upgradation / Automation:
Substation automation (SA) can provide integral functions to the distribution automation.
Modernizing the substation infrastructure is crucial for supporting the upgraded bidirectional grid
and achieving greater flexibility and efficiency. The current substation architecture, which is
specific to one task, can limit the ability to adapt to changing grid demands and emerging
technologies.
Levels of Substation Automation Substation integration and automation can be broken down into
five levels. The lowest level is the power system equipment, such as transformers and circuit
breakers. The middle three levels are Intelligent Electronic Devices (IED) implementation, IED
integration, and substation automation applications. All electric distribution utilities are
implementing IEDs in their substations. The focus today is on the integration of the IEDs. Once

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this is done, the focus will shift to what automation applications should run at the substation level.
The highest level is the utility enterprise, and there are multiple functional data paths from the
substation to the utility enterprise.

To modernize the MEPCO substation infrastructure for substation automation, several key areas
need to be addressed. These are mentioned below:

1. Hardware Upgrades:

This involves upgrading physical switchyard equipment such as transformers, circuit

breakers, isolators, protection relays, and communication equipment. These are the primary
substation equipment. For automating the substation, it is essential that the circuit breakers
and isolaters are capable of operating automatically through receipt of digital command
from the IED devices installed in the control room. IEDs, also called the secondary
equipment, including controller units and relays inside the substation control room for
protection and monitoring, with copper wires carry analogue output from switchyard
equipment. Typical IEDs in substations are Remote Terminal Units (RTUs), Bay
Control Units (BCUs). Other devices which are significant for the substation automations
are transducers, postion sensors, interposing relays.

For communication between these primary and secondary equipment, a communication

channel is essential to be established. Communication equipment involves, telecom cables,
fibre optic, ethernet switches, Wifi access points, GSM devices etc. Additionally, human
machine interface (HMI) will also be required for displaying the measure output and
statuses of the electrical equipment.

The architecture of the substation automation is beyond the scope of this roadmap and will
not be discussed here. However, the common protocol for substation automation is the IEC
61850 standard which defines the measures required for communication between electrical
components within the substation. It establishes vertical and horizontal communication
channels between equipment at three levels:

• Station level: At the station level, there is typically a centralized control system that
monitors and controls the entire substation. This can include functions such as supervisory
control and data acquisition (SCADA), which allows operators to remotely monitor the
status of the equipment and take corrective action as needed. The station level may also
include other functions such as system configuration management, alarm management, and
reporting.
• Process level: The process level in substation automation refers to the level of control and
monitoring that is associated with individual processes or systems within the substation.
This can include things like voltage regulation, protection relays, and switchgear control.
The process level typically includes local control devices and sensors that allow for real-
time monitoring and control of the individual processes.
• Bay level: The bay level in substation automation refers to the level of control and
monitoring that is associated with individual bays within the substation. A bay is typically
defined as a section of the substation that contains a set of equipment or apparatus for a

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specific function, such as a transformer or a circuit breaker. At the bay level, there may be
local control devices and sensors that allow for real-time monitoring and control of the
individual bays. The bay level can also include functions such as fault detection and
isolation, which can help prevent equipment damage and improve overall reliability.

Figure 6.3: Substation Automation Architecture

Newer technologies such as SCADA, phasor measurement units (PMUs) and

synchrophasors can provide more precise data on the state of the grid, enabling faster and
more accurate decision-making.

2. Software Upgrades:
Once the communication within the substation equipment is established, software
technologies such as Supervisory Control & Data Acquisition (SCADA), Energy
Management System (EMS), Distribution Management System (DMS), Wide Area
Monitoring System (WAMS) and other monitoring application are to be deployed for
control and management of the switchyard equipment. The measured analouge data and
statuses of the switcyard equipment is utilized by the distribution control center operators
for fast and effective control of the substation primary equipment in case of emergency.

Additionally, advanced algorithms for fault detection and self-healing can help to prevent
power outages and improve grid reliability. Detailed explanation of abovementioned
software applications will be explained in upcoming sections.

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6.2.2 Feeder Upgrade / Automation

Feeder Automation, a subset of Substation Automation, includes various applications that assist
power distribution company in maximizing the efficiency of its distribution feeder systems. By
providing robust data for planning, engineering, and maintenance, power distribution company
can operate closer to the physical limits of their systems, extend the useful life of their equipment,
and reap the benefits of deferring additional generation capacity, releasing transmission capacity,
and delaying or suspending distribution substation equipment purchases. Additionally, reliable
power delivery through Feeder Automation improves customer satisfaction.

In electric power distribution systems, a feeder typically consists of overhead or underground

cables and conductors which transmit power at a certain voltage level. This voltage level is in
range of 2.5kV to 34.5kV. The electric distribution feeder consists of electric poles and distribution
transformers. The distribution transformers are used to step down the voltage to low voltage after
which the service mains enter a consumers premises through an energy meter. The feeder lengths
vary depending upon the scheme of the electric utility. Protection equipment such as fuses,
insulators are also deployed at various points to secure the distribution of power. Grounding wires
are also installed for safety of general people as well as operational staff of the utility.

Figure 6.4: Conceptual Diagram of Distribution Feeder Network

In conventional electric distribution companies, the distribution system is mostly composed of

radial electric feeders designed for unidirectional flow of power. The continuity of service for
radial feeders is prone to unreliability. In the event of a fault anywhere along the radial feeder,
every consumer on the feeder experiences a power outage, unless the fault can be isolated at its
source with the use of disconnecting devices such as fuses, sectionalizers, disconnect switches, or
reclosers. Similar is the case in MEPCO. With no implementation of the feeder automation system,
MEPCO consumers suffers continuously from load shedding which depicts on balance sheets in
form of revenue loss. Some of the major advantages of feeder automation are mentioned below:

• Recognition of abnormal line conditions

• Reduced downtime

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• Fault Isolation & Service Restoration

• Minimise electrical losses
• Increase Revenue
• Efficient Monitoring of Field Assets
• Real time acquisition of field data
• Bi Directional Flow of Power
• Integration of Distributed Renewable Energy Generators
• Enhance Consumer Service and Satisfaction

To modernize MEPCOs Electric Feeder infrastructure, several key areas need to be addressed:

1. Hardware Upgrades for Services:

Deployment of field devices to sense and control the feeder are essential. Field devices
consist of sensors and automatic switches - Sensors detect important parameters on the
network like currents, voltages, power flows, while switches are used to control the power
flow in the network. Smart relays, smart sectionalisers/reclosers, fiber-optic distribution
feeder monitors, low voltage distributor monitors, and smart meters are all examples of
devices that can help distribution company monitor and manage their distribution feeders
more effectively.

Fuses are typically used on lateral branches of a circuit and are designed to open when the
current exceeds a certain level, thus protecting the equipment downstream. Once a fuse is
blown, it must be replaced manually. These are commonly installed in MEPCO and other
Distribution Companies of Pakistan.

Sectionalizers are used on the main feeder of a circuit and are designed to automatically
isolate the faulted section of the circuit. They work by detecting changes in current flow
and opening the appropriate section of the circuit, thus minimizing the impact of the fault
on the rest of the system.

Figure 6.5: Two Areas supplied by two distribution substation connected through sectionalizer

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Reclosers are also used on the main feeder of a circuit and are designed to operate like a
circuit breaker. They automatically interrupt the fault current and then reclose a preset
number of times in an attempt to clear the fault. If the fault persists, the recloser will
eventually go into lockout mode, which requires manual intervention to reset.

All these devices are important for protecting the electrical distribution system and
ensuring reliable service to customers. Furthermore, with remote control of these devices
in the control center, the operators can ensure minimum downtime and maximise revenue
through continuous supply of energy. A coordinated effort for implementation of the above
mentioned feeder upgrades is required at MEPCO for first phase of feeder automation.

Volt Var Optimization

Apart from the devices mentioned above, there are other more advanced equipment which
are used to overcome losses on a distribution feeder. For overcoming losses on an electric
feeder , Volt /Var Optimization (VVO) technique is used. There are several devices that
can be used for Volt Var Optimization in a distribution system. Following are some
examples:

1. Voltage regulators: Voltage regulators can be used to adjust the voltage level on a
distribution feeder by automatically changing the transformer taps or injecting reactive
power.
2. Capacitor banks: Capacitor banks can be used to supply reactive power to the
distribution system and help maintain the desired voltage levels.
3. Distribution line switches: Distribution line switches can be used to change the
topology of the distribution system by opening or closing branches, which can help
balance the reactive power flow.
4. Power factor correction devices: Power factor correction devices, such as
synchronous condensers or static VAR compensators, can be used to adjust the reactive
power flow in real-time.
5. Smart meters: Smart meters can be used to measure the voltage and power quality on
the distribution system and provide real-time data to the VVO control algorithms. The
deployment of smart meters (with controls) on feeder at specific points enable the
operators to visualize the real time operating condition. One such system is the
Distribution Transformer Monitoring System (DTMS). DTMS is explained in coming
sections.
All of these devices can be used individually or in combination to implement VVO on a
power distribution system. The choice of which device to use depends on the specific
characteristics of the system and the goals of the VVO implementation. It is to be noted
that the control and Monitoring of VVO is to be done through an application known as
Distribution Management System (DMS) which shall be explained in later sections.

2. Software / Application / Control & Monitoring System Upgrades

Once the sensors, switches and control devices are installed along with the communication
infrastructure (which shall be explained in coming sections), the important aspect is to

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utilize the measured data (historic or real-time) for reliable, safe and quick operation of the
distribution system. Various systems are available which are used successfully by utilities
across the world. Brief Description of these control / monitoring systems and applications
are described below.
Fault Location Isolation & Service Restoration
Feeder automation schemes for reliability improvement, such as advanced fault location
isolation and service restoration (FLISR), are also becoming more prevalent during the
modern grid era. Fault location isolation and service restoration (FLISR) is a process used
in electric distribution systems to detect and isolate faults or outages in the electric feeders
and to restore power service to the affected areas. The process involves the use of advanced
sensors (deployed across the feeder at various equipment and nodes), communication
networks and algorithms to identify and locate the faults and to quickly restore service to
minimize the impact on consumers. Resultantly, saving revenue loss for a utility.

FLISR typically involves three main steps:

1. Fault Detection: This step involves the use of advanced sensors and monitoring
systems to detect and locate faults in the power system. These sensors can detect
changes in voltage, current, and other parameters to identify the location of the fault.
2. Fault Isolation: Once the fault is detected, the next step is to isolate the affected section
of the power system. This is done by opening switches or breakers to disconnect the
faulty section from the rest of the system, thereby preventing the spread of the fault.
3. Service Restoration: After the fault is isolated, the final step is to restore service to
the affected areas. This is done by re-routing power through alternate circuits or by
bringing in additional power sources to compensate for the loss of power.
FLISR systems can be highly automated, allowing faults to be detected and isolated within
seconds. This helps to minimize the impact of outages on customers and to improve the
reliability and resiliency of the power distribution system overall. Currently, MEPCO lacks
any such fault location and isolation restoration services. This function is being carried out
manually which takes increased restoration time.

Figure 6.6: Difference in Restoration time of conventional and automated feeder

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Outage Management System

An outage management system (OMS) is a software-based solution used by power

distribution companies to quickly and effectively respond to power outages in their
distribution networks. The OMS provides real-time information on the status of the power
distribution system and helps utility companies to identify the location of the outage, the
extent of the damage, and the number of affected customers.

The OMS typically consists of several components, including:

1. Outage detection: This component uses various sensors and monitoring devices to
detect outages in the distribution network. It can also use information from customers
who report outages to the power distribution company.
2. Outage notification: Once an outage is detected, the OMS sends notifications to the
power distribution company's operations center, field crews, and customers. These
notifications can be in the form of alerts, emails, or SMS messages.
3. Outage analysis: This component analyzes the data collected during an outage, such
as the location and duration of the outage, to determine the cause and extent of the
damage. This information helps the utility company to prioritize restoration efforts.
4. Outage restoration: The OMS provides real-time information on the status of
restoration efforts, including the estimated time of restoration and the number of
customers restored. The OMS plays a critical role in the restoration of power
distribution systems by assigning workforces to the areas affected by outages. Once an
outage is detected and analyzed, the OMS determines the number and location of field
crews required to restore power to the affected areas. The system also prioritizes
restoration efforts based on factors such as the number of customers affected and the
criticality of the affected infrastructure. It shall be noted that FLISR is one of the major
applications of OMS. It is used at the distribution level in order to mitigate faults,
especially permanent faults.
5. Reporting: The OMS generates reports on outages and restoration efforts, providing
valuable insights into the performance of the power distribution network. It provides
insights on the utility’s important parameters such as System Average Interruption
Duration Index (SAIDI), System Average Interruption Frequency Index (SAIFI), and
so on.

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Figure 6.6A: OMS - Typical Outage Management Process in event of emergency

The OMS is an essential tool for power distribution companies, helping them to
minimize the duration and impact of outages, reduce restoration times, and improve
overall customer satisfaction.

6.2.3 Supervisory Control and Data Acquisition (SCADA) System

Distribution SCADA (Supervisory Control and Data Acquisition) also known as D-SCADA is a
system used by power distribution companies to monitor and control their distribution system. It
provides real-time information on the status of the power distribution network and enables
operators to make informed decisions about how to respond to changing conditions.

Figure 6.7: High level conceptual diagram of SCADA

The distribution SCADA system consists of several components, including:

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1. Remote Terminal Units (RTUs): These are devices installed at remote locations
throughout the distribution network. They collect data on the status of the equipment and
send it to the SCADA system which is installed in the distribution control center.

2. Communications network: The communications network connects the RTUs to the

SCADA system, allowing data to be transmitted in real-time.

3. SCADA servers / software: The SCADA servers receive and process data from the RTUs,
providing operators with real-time information on the status of the distribution network.

4. Human Machine Interface (HMI): The HMI is the interface used by operators to monitor
and control the distribution network. It displays real-time data on the status of the network
and enables operators to issue commands to equipment, such as opening or closing
switches. / circuit breakers / isolators.

5. Data historian: The data historian is a database that stores historical data on the status of
the distribution network. This data can be used for analysis and reporting purposes. The
database can either be on premises or cloud-based solution.
On-premises and cloud-based solutions both have their advantages and disadvantages, and
the choice between the two will depend on a variety of factors, including the specific needs
and requirements of the power distribution company.

On-premises solutions are installed and maintained locally on the company's own servers
and hardware. This provides greater control over the system and data, as well as the ability
to customize the system to meet specific needs. On-premises solutions can also provide
better security and data privacy, as sensitive data does not leave the company's network.
However, on-premises solutions can be more expensive to set up and maintain, as they
require dedicated hardware and IT staff to manage and operate.

Cloud-based solutions, on the other hand, are hosted by third-party providers and accessed
over the internet. This provides greater scalability and flexibility, as the solution can be
easily scaled up or down to meet changing needs. Cloud-based solutions are also typically
more cost-effective than on-premises solutions, as they do not require dedicated hardware
or IT staff. However, cloud-based solutions can be less customizable than on-premises
solutions and may raise concerns about data security and privacy.

The distribution SCADA system provides a number of benefits to power distribution

companies, including improved reliability, increased efficiency, and reduced downtime.
By providing real-time information on the status of the distribution network, operators can
quickly identify and respond to problems, such as equipment failures or power outages.
This can help to minimize downtime and reduce the impact of outages on customers.

In addition, the distribution SCADA system enables operators to monitor the performance
of the distribution network, identifying areas where improvements can be made to increase

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efficiency and reduce costs. By analyzing historical data, power distribution companies can
identify trends and patterns that can help them to optimize their operations and make more
informed decisions.

Figure 6.8: Typical connectivity till RTU within Substation

Figure 6.9: Connectivity with Station Bus & Process Bus of a substation

6.2.4 Distribution Management System (DMS)

A Distribution Management System (DMS) is a software platform that is used by power

distribution companies to monitor, control, and optimize their distribution networks. The DMS
provides real-time situational awareness of the network, enabling operators to respond quickly to
changes in demand, faults, or other events that could affect the reliability and quality of the power
supply. The DMS consists of several key components and application, including:

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1. SCADA (Supervisory Control and Data Acquisition) system: The SCADA system
monitors and controls the physical infrastructure of the distribution network, including
transformers, switchgear, and other equipment.
2. Outage management system: The outage management system (OMS) is used to detect,
analyze, and respond to power outages or other disruptions in the distribution network.
3. Distribution automation system: The distribution automation system (DAS) is used to
automate the operation of the distribution network, including functions such as fault
detection, isolation, and restoration.
4. Geographic Information System (GIS): The GIS is used to visualize and analyze the
distribution network, including the location of assets and infrastructure.
5. Energy management system: The energy management system (EMS) is used to manage
the flow of power through the distribution network, ensuring that supply matches demand
and optimizing the use of available resources.

Other than the above application and systems, a DMS network manager has visualization of other
systems also such as Meter Data Management System (MDMS), Customer Information System
(CIS).

Figure 6.10: Oversight on distribution system activities through DMS

The DMS provides a number of benefits to power distribution companies, including improved
reliability, increased efficiency, and reduced costs. By providing real-time information on the
status of the distribution network, operators can quickly identify and respond to problems, such as
equipment failures or power outages. This can help to minimize downtime and reduce the impact
of outages on customers.

In addition, the DMS enables power distribution companies to optimize the use of their resources,
including equipment, personnel, and energy resources. This can help to improve the overall
efficiency of the network, reduce costs, and minimize the environmental impact of the power
distribution system.

6.2.5 Energy Management System (EMS)

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An Energy Management System (EMS) in a distribution power system is a software platform that
is used to manage the flow of power through the distribution network. The EMS provides real-
time information on the status of the distribution network, including the location of assets and
infrastructure, the amount of power being generated, and the demand for power from customers.

The EMS uses this information to optimize the flow of power through the distribution network,
ensuring that supply matches demand and minimizing the risk of overloading or underloading the
system. The EMS also helps to reduce energy waste and costs by identifying opportunities for
energy efficiency improvements and demand response programs.

The EMS typically includes several key components, including:

1. Load forecasting: The load forecasting component uses historical data and other
information to predict future demand for power. This information is used to plan for the
generation and distribution of power, ensuring that the network is able to meet demand
while minimizing waste.
2. Energy trading: The energy trading component enables power distribution companies to
buy and sell energy on the wholesale market, optimizing the use of available resources and
minimizing costs.
3. Demand response: The demand response component allows power distribution companies
to incentivize customers to reduce their energy usage during peak demand periods, helping
to reduce the strain on the distribution network and avoid the need for expensive upgrades.
4. Distributed energy resource management: The distributed energy resource management
component enables power distribution companies to manage the use of distributed energy
resources, such as solar panels and wind turbines, on the distribution network.

The EMS provides real-time information of the energy flow status of the distribution network. The
EMS enables distribution system operators to quickly identify and respond to problems such as
difference in allocated quota and consumption. By having sensing devices installed throughout the
network, reconciliation of energy at critical nodes becomes quick. For ease of understanding, EMS
can be considered as a tool to regulate the energy flows while DMS is used to monitor and control
network in case needed.

6.2.6 Distribution Transformer Monitoring System (DTMS)

Reverse power flow can have a significant effect on distribution transformers. In a typical electric
distribution system, power flows from the high voltage level to the low voltage distribution
network and then to consumers premises. However, with increase in distributed generation
(especially the roof top solar PV) in some situations, power can flow in the opposite direction,
from the low voltage distribution network to the high voltage transmission network. This is known
as reverse power flow.

Reverse power flow can occur for a number of reasons, such as when distributed energy resources
(DERs) generate more power than is consumed locally by the consumer.

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Figure 6.11: Power Flows in Conventional and Modern Distribution Grids

The effects of reverse power flow on distribution transformers are severe and include:
1. Overloading: Reverse power flow can cause distribution transformers to be overloaded,
as they are designed to handle power flows in one direction. This can lead to overheating
and damage to the transformer. Thus, reducing the life of the distribution transformer.
2. Voltage fluctuations: Reverse power flow can cause voltage fluctuations in the
distribution network, which can affect the operation of sensitive electrical.
3. Reduced efficiency: Reverse power flow can reduce the efficiency of distribution
transformers, as they are designed to operate under normal power flow conditions. This
can lead to increased energy losses and higher operating costs.
To mitigate the effects of reverse power flow on distribution transformers, various solutions can
be implemented. One of the most effective solutions is the use of distribution transformer
monitoring system. A distribution transformer monitoring system (DTMS) is a type of system
used to monitor and control the performance of distribution transformers installed on feeders in
electric distribution system. This system uses sensors and monitoring devices (current and voltage
transformers) to gather data on various aspects of the transformer's operation, including
temperature, oil level, load flows, power factor, current and voltage. The DTMS system also has
a smart energy meter installed with communication capabilities with the control center. The signal
from the control center can off/on the distribution transformer in case of emergency or any other
event, for safe and reliable operation of the system.
The data collected by the monitoring system is then transmitted to a central control system, where
it can be analyzed and used to detect potential problems with the transformer. Often, this can be
integrated with SCADA system or the EMS. This information can be used to optimize the
performance of the transformer, reduce downtime, and prevent failures.
Some of the key features of a distribution transformer monitoring system include:
1. Remote monitoring: The ability to monitor the transformer's performance from a remote
location, which reduces the need for on-site inspections and improves efficiency.
2. Real-time monitoring: The ability to monitor the transformer's performance in real-time,
allowing for early detection of potential problems.
3. Data analytics: The ability to analyze the data collected by the monitoring system to
identify trends and patterns, which can be used to optimize performance and prevent
failures.
4. Alarm system: The ability to generate alarms when certain conditions are met, such as
high temperature or overload, which can help prevent damage to the transformer.
A distribution transformer monitoring system is a critical component of modern electrical power
networks, allowing for the efficient and effective management of distribution transformers to
ensure reliable and continuous power supply to consumers. MEPCO has more than 230,000

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Distribution transformers with an aggregated capacity of over 13,000MVA. It is therefore

important for MEPCO to launch a program for installation of DTMS covering all the distribution
transformers.
6.2.7 Enterprise Asset Management System (EAMS)
Enterprise Asset management is critical for electric power distribution companies to ensure that
they can provide reliable and cost-effective electricity services to their customers. An Enterprise
Asset Management System (EAMS) is a comprehensive approach to managing assets within an
organization, which includes processes, tools, and techniques for maintaining and optimizing the
performance of assets over their lifecycle. An Enterprise Asset Management System in a power
distribution company typically includes the following components:
1. Asset inventory: A comprehensive inventory of all assets, including transformers, cables,
switchgear, and other equipment, is maintained in a database. It shall not be limited to
electrical assets. It extends to all kinds of assets found in an organization such as vehicles,
office use assets etc.
2. Condition assessment: The condition of each asset is regularly assessed to identify any
signs of wear and tear or damage. This information is used to schedule maintenance and
replacement activities.
3. Maintenance planning: A maintenance schedule is developed based on the condition
assessment data to ensure that assets are maintained at the optimal level to avoid
breakdowns and reduce downtime.
4. Risk management: Risks associated with the operation and maintenance of assets are
identified and assessed. Appropriate mitigation measures are implemented to minimize the
risk of failure or damage.
5. Lifecycle management: The lifecycle of assets is managed from acquisition through to
disposal, including replacement and retirement planning.
6. Performance monitoring: Performance metrics are established to track the performance
of assets and identify areas for improvement.
7. Asset tracking: The location and status of each asset are tracked in real-time using
advanced tracking technologies, such as GPS and RFID.

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Figure 6.12: Enterprise Asset Management

An effective Enterprise Asset Management System can help electric distribution companies to
optimize their asset performance, reduce downtime and maintenance costs, improve customer
satisfaction, and ensure compliance with regulatory requirements.

Figure 6.13: Oracle EAM Dashboard View

For example, Scottish Power Energy Networks (SPEN), which is responsible for the electricity
transmission and distribution networks in Scotland, UK. SPEN implemented an EAM system to
manage their assets, including high-voltage cables, transformers, and overhead lines. The EAM
system helps SPEN to improve the reliability and availability of their assets, optimize maintenance
schedules, and reduce maintenance costs. It also helps them to track and manage asset-related data,
such as equipment location, condition, and performance, to make informed decisions about asset
replacement and maintenance strategies. By implementing the EAM system, SPEN has improved
their asset management practices, which has resulted in improved network performance and
enhanced customer satisfaction.

6.2.8 Information & Communication Technologies (ICT) Infrastructure:

While defining the above-mentioned technological interventions which are the need of the hour,
one critical component to make these applications successful is the Information & Communication

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Technologies (ICT) Infrastructure. It is a universal fact that a modern grid will have an effective
two-way communication network as compared to the conventional distribution system.

Two fundamental achievements of a modern communication infrastructure are:

1. Two-way communication capabilities between utility and its consumers

2. Real time flow of data from assets for effective monitoring and control of vast no. of
electrical equipment in the field

In current network of MEPCO, the communication infrastructure is nonexistent. Most of the

communication is done manually, which has a high ratio of error and is slow in nature. Further as
explained in sections above, for distribution system automation it is essential that information from
the installed sensors and monitoring devices reach the power distribution company control center
at high speed and high accuracy. Therefore, there is a strong need for developing a ICT
infrastructure in order to modernize the traditional distribution grid of MEPCO.

Figure 6.14: Distribution Automation Communication Network Conceptual Diagram

The starting point in any utility’s conversion to a digital world is the development of an ICT
framework. An ICT framework is an essential component of a modern grid as it provides the
necessary infrastructure and services to enable the seamless communication and integration of
various components in the power distribution grid. It helps utility to realize the interoperability of
different domains. For example, a load forecasting application would require information from
different sources i.e.., consumers (through AMI system), GIS, weather forecasting tool. Similarly,
in case of Demand Response (DR) application, real-time power consumption and generation data
is required from consumers and the connected distributed renewable energy generators. All this

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data will reach the distribution system operators through the ICT infrastructure which shall enable
them to carry out DR operations. Furthermore, with forecasted increase in renewable energy
generation into the distribution networks, optimal control of field assets (i.e., feeders, distribution
transformers and distributed generator set points) becomes important, if not mandatory.

An application-centric approach to developing a communication network should be followed for

MEPCO. The communication infrastructure for following applications can be defined as
mentioned above:
• Distribution Automation (DA)
• Supervisory Control and Data Acquisition (SCADA)
• Advanced Metering Infrastructure (AMI)
• Energy Management System (EMS)
• Distribution Management System (DMS)

As per earlier information in previous chapters, MEPCO has been implementing AMI on small
pilot scale. GSM network is being used as mode of connectivity for two-way communication.
Selection of appropriate communication technologies are very essential for a grid modernization
program to be successful.

6.2.9 Business Suites for Energy Utilities

Business Suite often known as Enterprise Resource Planning (ERP) is a type of software
application that integrates multiple business functions into a single, centralized platform. Business
suites typically include applications for financial management, human resources management,
supply chain management, customer relationship management, and analytics and business
intelligence. The main goal of Business Suite is to streamline business operations, improve
efficiency, and provide a comprehensive set of tools for managing different aspects of an
organization's operations.

Figure 6.15: Core Business Processes managed through ERP

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Core Business Process of Power distribution company through ERP:

There are several business suites available for electric power distribution company, each with its
own features and capabilities. Here are some of the most used ones:

1. Oracle Utilities:
Oracle ERP is a suite of integrated business applications that are designed to help organizations
manage their business operations. The Oracle ERP suite includes various modules such as
finance, procurement, supply chain management, human resources management, project
management, and more.

Oracle ERP is built on a centralized database that stores all the data related to an organization's
business operations. This allows users to access real-time information across different
departments and functions, providing a unified view of the organization's operations.

Oracle ERP is highly customizable and can be configured to meet the specific needs of
different organizations. It is designed to improve operational efficiency, reduce costs, and
provide better visibility and control over business operations.

Some of the key features of Oracle ERP include financial management, order management,
inventory management, procurement, supply chain planning, human resources management,
and project management. Oracle ERP is used by a wide range of industries including
manufacturing, healthcare, financial services, retail, and more.

2. SAP for Utilities:

SAP ERP (Enterprise Resource Planning) is a suite of integrated business applications
developed by SAP SE, a German multinational software corporation. SAP ERP is designed to
help organizations manage their business operations by providing a comprehensive set of tools
for managing various business processes.

The SAP ERP suite includes various modules such as finance, procurement, supply chain
management, human resources management, project management, and more. These modules
are built on a centralized database that stores all the data related to an organization's business
operations, providing a unified view of the organization's operations.

SAP ERP is highly customizable and can be configured to meet the specific needs of different
organizations. It is designed to improve operational efficiency, reduce costs, and provide better
visibility and control over business operations.

Some of the key features of SAP ERP include financial management, logistics, production
planning, sales and distribution, human resources management, and project management. SAP
ERP is used by a wide range of industries including manufacturing, healthcare, financial
services, retail, and more.

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It is encouraging to mention that MEPCO has already initiated implementation of business

suite application using SAP. However, for full benefits of the any business suite, fullscale
implementation is necessary. It is pertinent to mention that implementation of ERP is a
continuous and evolutionary journey for any organization. For example, DEWA’s journey of
revolutionizing its business process consisted of various waves with each wave taking further
steps forward towards modernizing its business processes.

Figure 6.16: DEWA’s SAP ERP Journey

GIS Enterprise in utilities:

A Geographic Information System (GIS) plays a crucial role in the utilities sector, providing a
powerful platform for managing, analyzing, and visualizing spatial data. GIS facilitates
comprehensive asset management by providing a spatial database that precisely maps and tracks
the location, condition, and maintenance history of power distribution assets, including
transformers, power lines, substations, and other infrastructure. Power distribution companies
use GIS for strategic network planning and design. It enables the analysis of geographic factors,
optimal routing, and the identification of suitable locations for new infrastructure, supporting
informed decision-making in expansion and upgrades. Through integration with Supervisory
Control and Data Acquisition (SCADA) systems, GIS provides visualization of network
performance, helping operators identify and respond to issues promptly. GIS seamlessly
integrates with other enterprise systems such as Enterprise Resource Planning (ERP) and
Customer Relationship Management (CRM), providing a holistic view of operations and
facilitating efficient data sharing across departments.

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Asset
Management

Network
Predictive Planning &
Maintenance Design &
Spatial Analysis

GIS
Enterprise
Field
Operations / Workforce
Better Customer Management
Service

Emergency
Response &
Disaster
Management

The concept of an enterprise Geographic Information System (GIS) revolves around meeting
the collective needs of various departments within an organization rather than addressing them
individually. The implementation of a unified and comprehensive GIS infrastructure aims to
minimize potential conflicts and misunderstandings, leading to notable cost savings and
performance improvements.

6.3 PA3: Enhanced Consumer Experience (CX) and Satisfaction Program

CX, or customer experience, refers to the overall experience that a customer has when
interacting with a business or organization. It encompasses all aspects of the customer journey,
from initial awareness of a product or service to post-purchase support and follow-up. CX is
becoming increasingly important for businesses as customers are placing more emphasis on
the experience they have with a brand.

A positive CX involves delivering a seamless, personalized, and engaging experience across

all touchpoints, including online, in-person, and via customer support channels. This can
involve implementing strategies such as customer journey mapping, data analytics, and
personalized messaging to deliver a consistent and positive experience at every stage of the
customer journey.

In the context of power distribution utilities, CX is becoming increasingly important as

customers expect more from their energy providers. Customers want to be able to access their
account information, receive timely and accurate billing, and have the ability to report outages

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quickly and easily. For enhanced CX, there are various measures a power distribution company
can undertake. This section will concentrate on modern intervention which a power distribution
company such as MEPCO should take which will lead up to satisfied consumers.

6.3.1 Advanced Metering Infrastructure (AMI)

AMI deployment has been one of the first grid modernization activities for many power
distribution companies, and a large number of meters are being deployed. In many instances,
however, AMI deployment is hindered by the lack of cost-effective communication networks
to support access to all consumer locations. Further, meter and AMI communication standards
are only in their infancy with varied levels of standards-based product implementation.
Therefore, much AMI deployment has so far been based on vendor-proprietary “AMI
solutions,”. While solutions vary depending on the AMI vendor, AMI solutions have four basic
components:

1. Neighborhood Area Network (NAN):

A neighborhood area network (NAN) is a type of network that connects the smart meters
in a particular neighborhood to a central data management system also known as the
meter data management system. The prevalent technologies used to develop a NAN for
Advanced Metering Infrastructure (AMI) are RF mesh and Power Line Communication
over narrowband frequencies (PLC-NB). RF mesh relies on wireless communication
over unlicensed spectrum, like the 900 MHz Industrial, Scientific, and Medical (ISM)
band in the US or the 2.4 GHz band, whereas PLC-NB uses the power line connecting
the distribution transformer's secondary to the consumer. In both cases, the
communication medium is readily available to the utility at no extra charge.

Other technologies that can be used for Neighborhood Area Networks (NANs) include
cellular and satellite communication. In a cellular network (also known as GSM
network), meters have a cellular modem that communicates with a cellular tower. The
communication is usually based on a subscription service, where the utility pays for the
communication. In a satellite network, the meters have a satellite modem that
communicates with a satellite in orbit. The communication is based on a subscription
service, where the utility pays for the communication. Both of these technologies are
less common for NANs because they usually require a higher cost than RF mesh or PLC
and may have limitations in terms of bandwidth or coverage. However, they can be
useful in areas where other communication technologies are not available or where the
utility needs to cover a large geographic area.

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Figure 6.17: Neighborhood Area Network (NAN), Field Area Network (FAN) & Wide Area Network (WAN)

2. Smart Meters:

Meters support a communication interface to connect to the NAN. This interface may
be integrated with the meter or attached to meters from different meter vendor models.

3. Meter (Data) Concentrator (sometimes called a collector):

The meter concentrator is responsible for establishing communication between the

meters in a particular neighborhood and the head end through the NAN. It collects
periodic measurements and alarms generated by the meters and sends commands from
the MDMS to the meters while receiving corresponding responses. In the case of an
RF mesh solution, a concentrator can support a large number of meters, ranging up to
several thousand, and is typically located at a substation or other designated location
within the neighborhood. On the other hand, in a PLC solution, meter concentration is
limited to the meters connected to the secondary of the distribution transformer.

4. Head End:

The head end is a critical component of the Advanced Metering Infrastructure (AMI)
system, which helps power distribution companies efficiently manage their metering
operations. The head end serves as the meter data management system (MDMS) of the
AMI solution, which collects and manages the data collected from the smart meters. It
communicates with the meter concentrator, which is responsible for collecting the meter
data from the smart meters deployed in the field and sending it to the head end for
processing and storage. The head end typically uses an Internet Protocol (IP) connection
provided by the Smart Grid to communicate with the meter concentrator, while the
communication protocol between the head end and the concentrator is vendor
proprietary.

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The head end also connects to the utility MDMS over an IP connection, which is usually
located at the utility Distribution Control Center (DCC). A standard protocol is used for
exchanging meter data, commands, and responses between the head end and the MDMS.
The MDMS is responsible for processing and storing the meter data, as well as providing
meter data analysis and reporting capabilities. By using the head end as the central data
management system, power distribution companies can more efficiently manage their
metering operations, leading to improved customer service, enhanced reliability, and
reduced costs.

Figure 6.18: Connectivity of Smart Meters through NAN to Data Center

The AMI infrastructure will rely on alternative communication technologies enabling the
deployed smart meters, low performance will be noticed without reliable and efficient
communication network, the following technologies currently in use by various utility:

• Higher stream between the gateway, data concentrator and the server (GPRS, 4G LTE,
WiMAX, LTE-M, NB-IOT, Lora WAN, Sigfox)
• Lower stream between field devices, meters and the gateways (Power line (prime g3 plc),
Mesh-network, Wi Sun, RF Mesh-IP, BPL)

Smart meters (Electricity smart meters) and communication modules depending on the
communication technology should be selected by MEPCO based on standard communication
protocol which is very essential for interoperability.

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Figure 6.19: AMI Architecture (From Meter to Cash) mentioning technologies for data transfer

6.3.2 Meter Data Management System (MDMS):

A Meter Data Management System (MDMS) is a software application that collects, processes, and
stores data from smart meters installed at consumer facilities. The MDMS is responsible for
managing the data flow between the meters and the utility company's billing and customer
information systems.

The MDMS typically receives data from advanced metering infrastructure (AMI) systems, which
are networks of smart meters that collect data on usage, power quality, and other metrics. The
MDMS then stores this data, performs quality checks, and processes it into a format that can be
Some features of a Meter Data Management System (MDMS) include:

1. Data Collection: The MDMS collects data from various types of meters, including
electric, gas, and water meters, and processes it for analysis and reporting.
2. Data Management: The MDMS stores and manages large volumes of meter data in a
secure, reliable, and scalable manner.
3. Data Validation: The MDMS validates meter data for accuracy, completeness, and
consistency to ensure that the data is of high quality and suitable for analysis.
4. Data Processing: The MDMS performs data processing tasks such as aggregation,
normalization, and filtering, to transform raw meter data into meaningful insights.
5. Analytics: The MDMS provides advanced analytics and reporting capabilities, enabling
power distribution companies to analyze meter data to identify trends, anomalies, and
opportunities for improvement.

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6. Integration: The MDMS integrates with other utility systems, including CIS, OMS, and
DMS, to enable data sharing and streamline operations.
7. Real-time Monitoring: The MDMS provides real-time monitoring and alerts for issues
such as meter tampering, equipment failure, and power outages.
8. Customer Engagement: The MDMS enables power distribution companies to provide
customers with detailed usage data and analysis, empowering them to make informed
decisions about their energy consumption.
9. Security: The MDMS provides robust security features, including access control, data
encryption, and audit logging, to protect meter data from unauthorized access and cyber
threats.
The MDMS is a powerful tool for power distribution companies to manage their meter data
effectively, optimize their operations, and improve customer service. The MDMS performs
several activities and connects to many other software applications enhancing the capabilties of
the utility. Power distribution companies worldwide using different software architecture based
on the applications e.g.
• Single MDMS (water, Electricity, Gas) with multi-Head-End
• Multi MDMS each for dedicated domain with multi-Head-End each for dedicated meter
brand
• Single MDMS with universal single Head-End integrating all meter’s brands

Figure 6.20: MDMS at the heart of Utility’s functioning

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6.3.3 Customer Information System (CIS)

The CIS typically integrates with other utility systems, including meter data management systems
(MDMS), billing systems, outage management systems (OMS), and work order management
systems (WMS), to provide a comprehensive view of customer information.

Some key features of a CIS include:

1. Customer Data Management: The CIS manages customer data, including contact details,
billing information, service history, and usage data, in a centralized database.
2. Billing and Payment Processing: The CIS generates bills, manages payment processing,
and provides customers with online billing and payment options.
3. Service Order Management: The CIS manages service orders, including new service
requests, service upgrades, and service cancellations.
4. Customer Service: The CIS provides customer service tools, including call center
management, online customer portals, and self-service options.
5. Analytics and Reporting: The CIS provides analytics and reporting capabilities, enabling
power distribution companies to analyze customer data, identify trends, and make data-
driven decisions.
6. Integration: The CIS integrates with other utility systems, including MDMS, OMS, and
WMS, to provide a comprehensive view of customer data and enable seamless data sharing.
7. Regulatory Compliance: The CIS supports compliance with regulatory requirements,
including data privacy regulations and consumer protection laws.

The CIS is a critical component of a modern utility infrastructure, enabling power distribution
companies to manage customer interactions, optimize operations, and improve customer service.

6.3.3.1 Consumer Engagement Activities:

Consumer engagement benefits power distribution companies in several ways. Engaged customers
are more satisfied with their utility and are more likely to remain loyal. By engaging with
customers, power distribution companies can build stronger relationships and improve the overall
customer experience. Engaged customers are more likely to adopt energy-saving behaviors and
invest in energy-efficient products. This ca4n help electric power utilities reduce their overall
energy demand, lower their operating costs, and improve their environmental performance.
Consumer engagement can also help power distribution companies increase revenue by
encouraging customers to participate in programs that generate new revenue streams. For example,
power distribution companies may offer demand response programs that pay customers to reduce
their energy usage during periods of peak demand, which can help utilities avoid expensive
investments in new infrastructure. By engaging with customers and promoting sustainable energy
practices, utilities can enhance their brand reputation and differentiate themselves from
competitors. This can help attract new customers and strengthen relationships with existing ones.
Many power distribution companies are subject to regulatory requirements related to energy
efficiency, renewable energy, and environmental performance. Consumer engagement can help

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power distribution companies meet these requirements and avoid penalties or other regulatory
actions.
There are several ways that power distribution companies can increase customer engagement. Here
are some ideas:

1. Personalized communication: Power distribution companies can use data analytics to

understand their customers' behavior, preferences, and needs. They can then use this
information to create personalized communication that resonates with their customers.
2. Education: Educating customers about energy conservation, energy efficiency, and the
benefits of renewable energy can help increase customer engagement. Power distribution
companies can create educational materials, such as videos, blogs, and social media posts,
to help customers understand how to save energy and money.
3. Rewards programs: Power distribution companies can offer rewards programs that
incentivize customers to save energy. For example, customers who reduce their energy
consumption during peak hours could receive a discount on their bill or earn points that
can be redeemed for prizes.
4. Mobile apps: Power distribution companies can create mobile apps that allow customers
to track their energy usage, view their bills, and receive alerts about outages or other events.
These apps can help customers feel more connected to their utility and provide them with
useful information.
5. Community outreach: Power distribution companies can engage with their customers
through community outreach programs. For example, they could sponsor community
events, such as energy fairs or home energy audits, to educate customers about energy
conservation and promote their services.
For example, San Diego Gas & Electric (SDG&E) has several consumer engagement programs
currently running to engage and empower its customers. Here are a few examples:

• Energy Savings Assistance Program: This program provides free home improvements to
eligible low-income customers to help them reduce their energy usage and save money on
their bills. The improvements include energy-efficient lighting, appliances, and
weatherization measures.
• Reduce Your Use Rewards: This program rewards customers for reducing their energy
usage during peak demand hours. Customers who enroll in the program and reduce their
usage during peak periods receive a bill credit or can earn points that can be redeemed for
gift cards.
• Power Your Drive: This program provides incentives for customers who purchase or lease
electric vehicles (EVs) and install a Level 2 EV charger at their home. Customers can
receive up to $500 for purchasing or leasing a new EV and up to $1,500 for installing a
charger.
• Energy Innovation Center: SDG&E's Energy Innovation Center is a resource center that
provides educational workshops, training, and resources to help customers save energy and
money. The center offers a range of services, including home energy audits, product
demonstrations, and sustainability consultations.
• Time-of-Use Pricing: SDG&E offers time-of-use pricing plans that incentivize customers
to shift their energy usage to off-peak hours when energy is less expensive. Customers who

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enroll in these plans can save money on their bills by reducing their energy usage during
peak periods.

Increasing customer engagement requires a thoughtful and strategic approach that takes into
account the unique needs and preferences of each utility's customer base. By using a combination
of these tactics, power distribution companies can build stronger relationships with their customers
and improve their overall customer experience. MEPCO requires dedicated effort in order to
engage its consumers to stay loyal.

6.4 PA 4: Decarbonization through Inclusion of Renewable Energy

Decarbonizing power distribution systems through the use of renewable energy sources is a key
strategy for reducing greenhouse gas emissions and combating climate change. Renewable energy
sources such as solar and wind power etc., do not emit greenhouse gases during operation, making
them an environmentally friendly alternative to fossil fuel-based power generation.

There are several ways in which renewable energy can be used to decarbonize power distribution
systems. One approach is to generate electricity from renewable sources and feed it into the
existing power grid. This requires investment in renewable energy infrastructure such as solar
panels and wind turbines, as well as grid integration technologies that allow for the efficient
distribution of renewable energy to consumers.

Another approach is to implement distributed energy systems, which involve the use of small-scale
renewable energy technologies such as rooftop solar PV and micro wind turbines to generate
electricity locally. These systems can be connected to the grid or operated independently,
depending on the specific needs of the consumers.

Decarbonizing power distribution through renewable energy sources also requires investment in
energy storage technologies such as batteries, which can help manage the intermittent nature of
renewable energy generation and ensure a reliable supply of electricity.

In addition to reducing greenhouse gas emissions, the use of renewable energy sources for power
distribution has a number of other benefits, including improved energy security, increased
resilience to natural disasters and other disruptions, and reduced dependence on imported fossil
fuels.

Pakistan has set an ambitious target of generating 30% of its electricity from renewable sources
by 2030, with a focus on solar power. More recently, Government of Pakistan has launched a Solar
initiative 2022 guidelines which shall inject approximately 10,000MW Solar into Pakistan’s
energy system. Out of this 10,000MW, 4000MW will be injected into Distribution system of
Pakistan in various areas. Moreover, Net Metered Distributed generation regulations also
encourage consumers to install roof top generators and become prosumers. This indicate that in
future years, the distribution grid will face stresses, if not upgraded and modernized, due to
increase in renewable energy penetration.

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The renewable energy system can be connected at different voltage level depending on the size
of the system, location, and network constraints.
• Injection at 132kV voltage level (≥40MW to 150MW)
• Injection at 66 kV voltage level (≥4MW to 40MW)
• Injection at 11kV voltage level (≥1MW to 4MW)
• Injection at Low Voltage level (≤1MW)

• Expected RE on 132kV
MEPCO under regulators electric procurement regulations has to submit a power acquisition
plan (PAP) annually. Due to the recent launch of wholesale energy market, the first version of
PAP is submitted to regulator for review and approval. As per MEPCO for FY 2023 0 MW of
RE is planned for FY 2023 while 50MW is planned for FY 2024 and 0MW is planned for FY
2025 to 2027.
• Expected RE on 11kV (≥1MW up to 4MW):
• MEPCO has 1,726 MV feeders. Assuming that 10% of the feeders allocated for solar with
2 MW per each. This will ensure that 345MW of Solar PV will be connected at MV level
of MEPCO.
• Distributed Generation at LV (Net-Metering)
• The Government of Pakistan committed net-metering 370 MW for each year as per the
approved Generation Capacity Expansion Plan of Pakistan 2022. Out of this, MEPCO’s
share is assumed as calculated and provided in below table 6.3.
• This generation will be connected at LV level i.e., 0.4kV-0.23kV
• The total capacity connected at MEPCO LV network by 2031 shall be approximately
1797MW.
Table 6.3: Forecasted Renewable Energy Connected to MEPCO Network
Year
2023 2024 2025 2026 2027 2028 2029 2030 2031 Total
Overall
4544 5503 5835 6168 6545 6934 7333 7751 8161
Demand (MW)
HV 132kV 400* 0* 25* 25* 25* 25* 25* 25* 25* 175
MV 11kV 1 43 43 43 43 43 43 43 43 345
LV 0.4kV-0.23kV 133 150 166 183 200 216 233 250 266 1797

Total Yearly 534 193 234 251 268 284 301 318 334 2717
Total RE connected to
534 727 961
MEPCO 1212 1480 1764 2065 2383 2717
RE % of Overall
11 13.2 16.46 19.5 22.61 25.43 28 30 33
Demand

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*Note: Currently, there is 400MW of RE Generation at 132kV network of MEPCO. However, through CTBCM, suppliers may show
intention to connect their RE power plant to 132kV network of MEPCO. For this purpose, 25MWis assumed each is kept from year
2025 till 2031.Hence a total of 175MW is assumed to be connected at 132kV network of MEPCO by 2031.

The above table shows that by 2031, MEPCO will have 33% renewable energy connected capacity
of its peak demand. This 33% RE capacity shall be connected at all three distribution voltage
levels.The high percentage of RE penetration in MEPCO network emphasizes the implementation
of the technology roadmap. Since, MEPCO currently lacks grid modernization , we therefore
segregate the roadmap in terms of the phase wise penetration of RE into MEPCO distribution
system.
• Phase 1 is present to cater for RE penetration of upto 5%
• Phase 2 is between 5%-10%
• Phase 3 is for above 10% RE penetration
It should be noted that the above does not include any micro grid in MEPCO service territory.

6.4.1 Renewable Energy Hosting Capacity Analysis:

Renewable Energy hosting capacity analysis (HCA) is a method used to assess the ability of a
power distribution system to accommodate the integration of renewable energy sources such as
solar and wind power. It involves analyzing the technical limits of the distribution system to
determine the maximum amount of renewable energy that can be integrated without causing issues
such as voltage instability or overloading of distribution lines.
The first step in conducting a hosting capacity analysis is to collect data on the distribution system,
including the location and capacity of existing generation sources, load profiles, and network
topology. This data is then used to model the distribution system using specialized software tools
that simulate the behavior of the system under different conditions.
Next, the hosting capacity of the distribution system is assessed by analyzing the impact of
different levels of renewable energy integration on key parameters such as voltage levels, line
capacity, and power quality. This analysis takes into account the variability and intermittency of
renewable energy sources and considers factors such as time of day, weather conditions, and load
variations. Hosting capacity analysis can be used to identify areas of the distribution system where
renewable energy integration is feasible and where upgrades may be required to accommodate
higher levels of renewable energy.

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Figure 6.21: Heat Map of a Distribution Feeder Hosting Capacity Analysis

6.4.1.1 Combination of Hosting Capacity Analysis with Distribution

Automation:

By combining hosting capacity analysis with distribution automation, power distribution

companies can better manage the variability and intermittency of renewable energy sources and
improve the overall efficiency and reliability of the distribution system. Use of Distribution
Automation techniques defined earlier such as advanced sensors and communication systems can
provide real-time data on the performance of the distribution system, allowing power distribution
companies to quickly identify and address issues such as overloads and voltage fluctuations.

For example, the use of smart inverters with advanced control capabilities can enable distributed
energy resources such as rooftop solar panels to provide grid support services such as voltage
regulation and reactive power control. This helps to maintain grid stability and reduce the need for
traditional grid infrastructure upgrades. Similarly, power distribution companies can use smart
meters to monitor the energy consumption/generation of individual customers/prosumers and
adjust their energy usage/ generation in response to changes in RE supply.

For MEPCO smooth integration of RE technologies, hosting capacity analysis shall be carried out
in advance and shall be made as a public document for consumers, regulator and other
stakeholders.

6.4.2 Renewable Energy Planning, Forecasting & Analysis Tools:

Renewable energy planning and analysis in distribution power systems typically involves a variety
of software tools to model and optimize renewable energy resources and their integration with the
grid. RE planning tools allow distribution system planners to optimize the integration of renewable
energy resources into the power system, taking into account factors like load demand, transmission

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constraints and energy storage systems. This optimization can help to reduce costs, improve
reliability, and increase the penetration of renewable energy resources in the distribution power
system.
Traditionally, conventional distribution power companies have not used renewable energy (RE)
modeling and planning tools for several reasons:

1. Lack of awareness: Many distribution power planners may not be aware of the availability
and benefits of RE modeling and planning tools. They may be more familiar with
traditional power system planning tools and may not have received training on how to use
RE-specific tools.
2. Limited data availability: RE modeling and planning tools require a significant amount
of data, such as solar and wind resource data, load demand data, and transmission system
data. In some cases, this data may not be readily available or may be incomplete, making
it challenging to use RE-specific planning tools.
3. Perception of high cost: Some distribution power planners may perceive RE modeling
and planning tools to be costly, both in terms of software and training costs. This perception
can discourage planners from investing in these tools, even if they have the potential to
improve decision-making and reduce costs in the long run.
4. Institutional barriers: Institutional barriers, such as lack of supportive policies or
regulations, can also hinder the adoption of RE modeling and planning tools. In some cases,
planners may not have the authority or resources to implement renewable energy projects,
making the use of RE planning tools less relevant.
5. RE as Threat: Some Distribution companies consider RE as a threat to their business
model. Self-generation and consumption through distributed RE generators are considered
as revenue loss. Therefore, the distribution planners turn away from RE planning.

However, as the cost of renewable energy generation continues to decline and policymakers and
power distribution companies place greater emphasis on reducing greenhouse gas emissions and
increasing renewable energy integration, the use of RE modeling and planning tools is becoming
increasingly common among more advanced and modern power distribution companies. Many
power distribution companies are investing in training programs and software tools to support the
adoption of renewable energy and the development of effective RE planning strategies.

Considering, MEPCO has an increased penetration of net metered Solar PV capacity as compared
to other distribution companies of Pakistan, it is need of hour that the distribution planners of
MEPCO utilize RE Planning tools for analysing the effects of RE in MEPCO power network.
MEPCO currently uses PSS/E and Synergi for its 132kV and 11kV network planning and analysis
respectively. However, the capacity to simultaneously simulate HV, MV and LV distribution
network is lacking. Furthermore, the capability to simulate the effect of distributed RE sources
onto the network parameters is also missing. An intelligent grid monitoring platform is required
which enables the distribution system planners to correctly simulate the stresses on the network
and optimize the injection of intermittent RE sources.

6.4.3 RE Forecasting:

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RE forecasting refers to the process of predicting the output of renewable energy (RE) sources
such as solar, wind and hydroelectric power and others. The goal of RE forecasting is to provide
accurate and reliable information about the expected energy production from these sources, which
can help distribution grid operators, power distribution companies, and energy traders manage the
variability and uncertainty of RE sources and ensure a stable and reliable energy supply.

RE forecasting typically involves the use of mathematical models that take into account a range of
variables such as weather patterns, geographic location, and historical production data. These
models can be used to generate short-term (e.g., hourly or daily) or long-term (e.g., monthly or
seasonal) forecasts of RE production. Accurate RE forecasting is essential for the effective
integration of RE sources into the power distribution system, as it allows operators to plan and
manage the energy supply more effectively and efficiently.

There are several renewable energy (RE) forecasting tools available in the market for distribution
operators to help them better manage the integration of variable RE sources into their distribution
networks. By predicting the output of variable RE sources, the distribution system operators can
better manage the fluctuations in energy supply and demand and maintain grid stability. This is
particularly important as the share of renewable energy in the distribution system increases, as the
variability and uncertainty of these sources can impact the stability of the grid.

Despite having above 90MW of connected distributed generation in the distribution network,
MEPCO does not have any RE forecasting capabilities. With ambitious targets of RE injection
planned, the lack of RE planning and forecasting tool can result in significant risks and challenges
to MEPCO, project developers and the power sector as a whole.

6.4.4 Developing Microgrids:

Electric power distribution utilities are increasingly making microgrids as part of their energy
infrastructure. Microgrids can be developed and operated by a electric utility as a way to improve
the reliability and resilience of its energy system, reduce congestion on the main grid, and integrate
more renewable energy sources.

A power distribution utility may establish microgrids in remote or rural areas where it is difficult
or expensive to connect to the main grid. In addition, power distribution companies can partner
with private companies and other stakeholders to develop microgrids that are owned and operated
by third parties but are still integrated into the utility's overall energy system.

The development of microgrids by electric power distribution companies can provide significant
benefits for both utility and its customers, including improved energy reliability and resilience,
increased use of renewable energy sources, and reduced greenhouse gas emissions.

MEPCO has 12,955 villages in its service territory [NEPRA SOI] which are unelectrified. This is
one area where MEPCO can explore to provide its services and generate revenue. NEPRA has
launched its Microgrid regulation 2022 after which any entity can establish a microgrid.

6.4.5 Distributed Energy Resource Management (DERMS)

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Distributed energy resources (DERs) refer to a range of renewable energy assets like solar, wind,
storage, and electric vehicles that supply power to, and draw power from, the larger electricity
grid. As these assets, such as rooftop solar panels, are often owned privately, they lie beyond the
control of grid operators. Nevertheless, there is a growing need to provide power distribution
companies and asset managers with advanced tools that can balance electricity production, storage,
and delivery across the network. The solution is a distributed energy resource management system
(DERMS).

Distributed energy resource management system (DERMS) is a combination of hardware and

software that enables real-time communication and control across these edge devices. These
systems depend on sensors and receivers to provide network-wide coordination. Sensors provide
real-time data to grid operators about energy production and storage, while receivers help
distributed energy assets accommodate power fluctuations as instructed by the grid. DERMS work
alongside other smart grid concepts such as microgrids and AMI to ensure smoother electricity
delivery and optimize resource allocation within the network.

Microgrids, for instance, operate as grid-connected power plants that aggregate and localize DERs.
The concept of resilience, on the other hand, is about the redundancy built into grids, ensuring that
a malfunction in one section of the network doesn't affect the entire grid.

A scenario where DERMS is effectively utilized is provided for better understanding. A sudden
decrease in solar energy production occurs due to cloud cover in the largest residential
neighborhood of the city. The grid operators respond quickly by increasing the energy production
at the coal-burning plant to balance out the shortage. As it is a Saturday, the electric school buses
are switched to slow-charging to create more room for energy supply. When the clouds clear and
the wind energy production picks up, the rooftop solar assets in the neighborhood work at full
capacity, complemented by the wind farms outside the city. With the increase in energy generation,
the utility reduces coal-burning plant production. Fast-charging is also enabled for all grid-
connected batteries and electric vehicles to store the surplus energy. This type of scenario happens
continuously, with DERMS utilizing sensor data and receiver communications to optimize energy
production and storage across distributed grid-connected assets in real-time.

The above example is for an advanced modern utility. However, for a utility like MEPCO, DERMS
can be utilized to manage the distributed generation connected to its 0.4kV network.

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Figure 6.22: High Level representation of DERMS and its connectivity with other applications

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6.5 PA5: Organizational Re-Structuring

Creating new departments within an organization can be a strategic decision that helps the
organization achieve its goals and objectives. Advancements in new technologies can create the
need for new departments within an organization. As organizations adopt new technologies, they
will require to establish newer department, divisions, working groups to support the
implementation, operation, and maintenance of these technologies. However, the adoption of these
new technologies can require changes in organizational culture and practices. New departments
can help organizations better adapt to these changes by providing expertise and leadership in these
areas. These departments can also help organizations stay up-to-date with the latest technologies
and best practices in their field.

6.5.1 Establishment of Renewable Energy Department

It is true that renewable energy technologies can be a new and complex subject for distribution
system professionals to fully understand. The topic of renewable energy is different from
conventional distribution systems. The integration of renewable energy into the distribution system
requires a different set of policies and regulations as compared to conventional ones. For example,
net metering policies may need to be put in place to compensate distributed generators for the
energy they contribute to the grid, and interconnection standards may need to be established to
ensure the safe and reliable integration of renewable energy sources with the distribution network.
Therefore, it is important for distribution system professionals to develop a deep understanding of
renewable energy technologies, policies, and regulations to effectively integrate renewable energy
into the distribution system and ensure a reliable and sustainable distribution grid for the future.
There are many power utilities around the world that have established renewable energy
departments or divisions to manage the integration of renewable energy sources into their energy
portfolios. For example, NextEra Energy Resources is a subsidiary of NextEra Energy, one of
the largest electric utilities in the United States. NextEra Energy Resources is responsible for
managing the company's renewable energy portfolio, which includes wind, solar, and energy
storage assets. Another example is that of Iberdrola Renewables which is a subsidiary of
Iberdrola, a Spanish multinational electric utility company. The company has a dedicated
renewable energy division that manages its global portfolio of wind, solar, and hydropower
projects.
For this purpose, MEPCO needs to establish a dedicated department consisting of team of
renewable energy professionals which can guide the management and other departments on how
to procure, install, operate, maintain renewable energy systems with their existing distribution
system. This team will shall also be trained to use RE forecasting, planning and analysis tools
which shall be input to the holistic planning of the distribution system. Additionally, it can also be
responsible for providing guidance on storage technologies and their importance within MEPCO
service territory. Furthermore, this department can also provide its input on establishing microgrids
with MEPCO service area.
Hierarchy of the proposed RE Department initially could be as follows:

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Director
Renewable
Energy

Deputy Deputy
Director-1 Director -2

Assistant Assistant
Director -1 Director-2

Figure 6.23: Proposed HR model for RE Department

6.5.2 Establishment of ICT Department

The ICT (Information and Communication Technology) department in a power distribution
company is responsible for managing the communication technology infrastructure and its
associated systems/applications that support the operation of the distribution company’s network.
This includes the management of communication hardware and software systems, network
infrastructure, cybersecurity systems, and data storage systems. The ICT department is responsible
for identifying and implementing new digital technologies, such as smart grid systems, advanced
metering infrastructure, and predictive analytics systems, to improve the efficiency and reliability
of the power distribution grid. It manages the communication systems that support the operation
of the power grid. This includes systems that enable communication between field devices,
sensors, IEDs etc. and the data centers. The ICT department is also responsible for ensuring that
the utility's technology infrastructure and communication systems comply with all applicable
international or national regulations and standards. The ICT department provides technical support
and training to other departments within the power distribution company to ensure that employees
can effectively use the technology infrastructure and communication systems to support the
business as usual processes within the utility.
For example, Dubai Water & Electricity Authority (DEWA) has a highly advanced ICT
infrastructure and is considered one of the most technologically advanced power distribution
companies in the world. DEWA's ICT department is responsible for managing the company's
technology infrastructure, software applications, and digital systems. The department focuses on
developing and implementing advanced digital solutions to optimize DEWA's operations, enhance
customer service, and promote sustainability. DEWA has both a central ICT department and
various subsidiaries that manage specific aspects of the company's ICT infrastructure. The central
ICT department is responsible for managing the overall ICT strategy, architecture, and governance
of DEWA while several subsidiaries that manage specific areas of the company's ICT
infrastructure.
InfraX and Moro Hub are two subsidiary companies of DEWA that focus on managing specific
aspects of the company's ICT infrastructure (Communication Infrastructure and Data Center).

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Similarly, Pacific Gas and Electric (PG&E), a major electric distribution utility in California, USA,
has an ICT department responsible for managing the company's technology infrastructure, data
centers, and network security.
The ICT department plays a crucial role in supporting power utility applications like MDMS
(Meter Data Management System), DMS (Distribution Management System), EMS (Energy
Management System), and ADMS (Advanced Distribution Management System).
Although MEPCO has an IT department, however, it is strongly proposed that an ICT department
shall be established considering the recent initiatives of AMI and SCADA being undertaken. Some
of the tasks which MEPCOs ICT department can perform in future as mentioned below:
• Infrastructure Management:
The ICT department is responsible for managing the underlying technology infrastructure,
such as servers, storage, and networking, required to support these applications. They
ensure that the infrastructure is scalable, reliable, and secure, and meets the performance
requirements of the applications.

• Software Application Management:

The ICT department manages the software applications that support these power utility
applications. This includes installation, configuration, and customization of the software
applications. They also ensure that the applications are properly integrated and that data
flows between them efficiently.

• Data Management:
The ICT department manages the data required to support these applications, including
data storage, backup, and recovery. They also ensure that the data is accurate, timely, and
secure.

• Cyber Security Management:

The ICT department is responsible for managing the security of these applications,
including the security of data, infrastructure, and applications. They ensure that appropriate
security measures are in place to prevent unauthorized access, protect against cyber threats,
and comply with regulatory requirements.

• System Integration:
The ICT department is responsible for integrating these applications with other systems
used by the power utility, such as billing systems, outage management systems, and
customer information systems. This ensures that data flows seamlessly between these
systems, enabling the power utility to operate more efficiently and effectively.

• Network Management:
The ICT department manages the network infrastructure that supports these applications,
ensuring that the network is reliable, secure, and provides adequate bandwidth for data
transmission. It can alternatively manage the third-party network providers.

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The human resources required for an ICT (Information and Communications Technology)
department in an electric distribution utility will depend on various factors, such as the size of the
utility, the complexity of its operations, and its strategic goals. Although MEPCO has an existing
IT department, it requires a major revamp in order to modernize the overall utility. For utilizing
technology in its routine works and operations, a dedicated team of subject matter experts is
required. Some of the roles required to be fulfilled are below:
• Chief Information Officer (CIO) :
This person is responsible for the overall management of the ICT department and the
implementation of the ICT strategy aligned with the MEPCO‘s business objectives.
• Infrastructure Manager:
This person is responsible for managing MEPCO‘s ICT infrastructure, including hardware,
software, networks, and communication systems. In case MEPCO decides to outsource the
infrastructure to a third party , then this resource oversee/monitor the crucial activities of
the third party contractor.
• Cybersecurity Manager:
This person is responsible for ensuring the utility's ICT systems are secure and protected
against cyber threats and attacks.
• Application Manager:
This person is responsible for managing the development, maintenance, and support of
software applications used by the utility.
• Data Analyst:
This person is responsible for analyzing and interpreting data generated by MEPCO ICT
systems to support decision-making processes.
In the case of MEPCO, the IT department has existed since inception. Over time, the department
has evolved to become the MEPCO Computer Centre, which is responsible for the operational
level activities while the development and maintenance of critical software such as the Integrated
Billing System (IBS) and allied services have been allocated to Power Information Technology
Company (PITC) for which MEPCO is paying. MEPCO’s IT department has limited human
resource.
MEPCOs existing IT department is managing routine tasks related to following:
• Customer Information System
• MIS Reporting
• Systematic Nomenclature of Accounts and Procedures
• ERP implementation support
• Support for GIS implementation
• MEPCO Webmail server management
• Electricity New Connection (ENC) support to PITC
• LAN network for MEPCO offices
• MPLS network

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All the above services are conventional electric utility services. The creation of ICT or
upgradation of IT department to ICT department will enable MEPCO to handle sophisticated
task related to digitization of its physical assets and control and monitoring of these assets
through a unified platform housed within MEPCO either through on prem servers or cloud
servers. MEPCO proposes the following organogram for its revamped IT department:

Director Billing &

Operations

Director AMI

Director ERP

Director
Infrastructure
Director Software
Director General IT Applications
Director
Management
Director Cyber
Security
Director System
Integration
Director Network
Management

6.5.3 Dedicated Cloud Services

Cloud services allow power distribution companies to scale up or down their data hosting needs
as demand fluctuates, without having to invest in additional hardware and infrastructure. By using
cloud services, power distribution companies can avoid the upfront costs of building and
maintaining their own data centers, as well as the ongoing costs of upgrades, maintenance, and
security. Cloud service providers typically have robust data centers and backup systems that ensure
high availability and uptime, which is critical for power distribution companies that need to ensure
uninterrupted service for their customers. Cloud service providers often have advanced security
measures and protocols in place to protect data from cyber threats, which can be a significant
concern for power distribution companies that handle sensitive customer information. Cloud
services offer utilities the flexibility to choose the most appropriate hosting solutions for their data,
such as private, public, or hybrid clouds, depending on their specific needs and requirements.

Considering the benefits offered by cloud, Pakistan has also developed its cloud first policy.
Pakistan's Cloud First Policy is a national initiative that aims to accelerate the adoption of cloud
computing technology across the country's public sector organizations. The policy was launched
in 2020 by the Ministry of Information Technology and Telecommunication (MoITT) and is part
of the government's broader digital transformation efforts. The Cloud First Policy requires all

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government agencies and public sector organizations to evaluate cloud-based solutions as their
first option when considering new IT investments or upgrading existing systems. The policy
encourages the adoption of cloud-based technologies to enhance collaboration, productivity, and
efficiency while reducing costs and increasing agility.

In line with Pakistan’s cloud first policy, distribution companies of Pakistan should look to
accelerate its digital transformation through usage of cloud services. MEPCO can follow examples
from various modern utilities of the world. For example, DEWA has implemented a cloud-first
strategy and has migrated several applications and services to the cloud to improve operational
efficiency and reduce costs. One such service is for monitoring their solar power plants, which
enables them to monitor the performance of their solar plants in real-time and optimize their
operations. DEWA has partnered with various cloud service providers, including Microsoft Azure
and Amazon Web Services (AWS), to host their data and applications.

An Oracle study of 100 energy and utility companies in the United States reports that almost every
utility in the U.S. (97%) uses cloud-based applications already or plans to in the future. 89% of
executives surveyed said they’ll send meter data management (MDM) information to the cloud in
the next three years, and 69% plan to use cloud for their customer information systems within three
years.

Figure 6.24: Pros & Cons of Cloud & On Prem Solutions

6.5.4 Cloud Computing Service:

Cloud computing provides a variety of services, and SaaS, PaaS, and IaaS are three of the most
popular models.

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SaaS, or Software-as-a-Service, provides users with access to software applications that are
hosted on a cloud provider's server and can be accessed via a web browser or mobile app. This
allows organizations to use software without the need to install and maintain it on their own
servers, which can save time and money.

PaaS, or Platform-as-a-Service, provides users with access to a cloud-based environment where

they can build, test, and deploy software applications without having to install and manage the
underlying infrastructure. This can be particularly useful for software developers who need a
flexible and scalable environment to work in.

IaaS, or Infrastructure-as-a-Service, provides users with access to computing resources such as

processing power, storage, and network capacity, which they can use to build and run their own
software applications. This allows companies to avoid the cost and complexity of building and
maintaining their own infrastructure and instead use the resources of a cloud provider.

Figure 6.25: Annual Rate of Data Intake from Various Applications

6.5.5 Social Media Marketing Department:

Social media has become an essential means for utility companies to stay in touch with their clients
and serve as a vital source of information. Leading social networking platforms like Facebook and
Twitter are frequently utilized to offer comprehensive details to electricity consumers regarding
their power supply status. Instead of a one-way stream of information, social media facilitates a
two-way conversation between the utility company and the customer, which is more responsive
and engaging.

To preserve a favorable rapport with their clients during power outages, utility companies need to
sustain a customer-centric connection when the electricity is running. They achieve this by
providing pertinent data and materials to their intended audience. Despite being more distant from
in-person interactions, this personalized approach enables customers to view utility companies not

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merely as a big corporation but as a team of diligent individuals who pay attention to and value
their customers' power requirements.

Even if the precise time for power restoration is not yet known, a rapid dissemination of
information, including details about the location, timing, people involved, and the nature of the
issue, followed by a series of ongoing updates, can provide customers with some information they
can process while waiting for additional details to become available.

Social media provides an opportunity for power distribution companies to distribute visual content
to a wide audience, which they often leverage to enhance their customer engagement. Since
humans tend to process visual information faster than textual information, social media posts that
include relevant visuals can increase comprehension by up to 98%.

For example, amid Hurricane Sandy in 2012, several utility providers in USA utilized Twitter,
resulting in approximately 20 million tweets being posted during and after the disaster. A year
later, as three major winter storms hit the UK in quick succession, UK Power Networks effectively
used their Twitter account to direct inquiries from the call center to their website and dramatically
improved call center response time. The Christmas storm was reported to have generated a
staggering 103 million Twitter impressions. In August 2014, when Hurricane Iselle hit the Hawaii
islands, Hawaiian Electric took recourse to Instagram as part of its online communication effort.
FortisBC is a Canadian electric utility that uses social media platforms such as Twitter, Facebook,
and Instagram. It utilizes YouTube to provide customers with educational videos on topics such
as energy conservation and natural gas safety.

Thus, social media can be a useful tool for detecting early warning signs of potential issues, such
as asset breakdowns and power outages, scheduling visits from engineers, providing advanced
notifications about extreme weather conditions, and issuing advisories and notifications for
effective crisis management.

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Due to frequent outages (planned & unplanned) experienced by electric utilties in Pakistan, usage
of social media for customer engagement becomes an obvious choice. MEPCO must develop a
social media plan that integrates elements of consumer engagement, brand awareness, consumer
education, and customer service. Utilizing YouTube and Facebook to educate their customers
about various topics such as energy management, energy efficiency, the benefits of smart meters,
power industry trends and tariff pricing and distributed generation will develop trust on the utility.
Therefore, a social media management department is proposed within MEPCO. The department
can work within the customer services department. It is also worth mentioning that social media
works inline with outage management system for informing outages to consumers.

Figure 6.26: Use of Social Media for Informing Customers about Outage

Figure 6.27: Use of social media for Informing Customers about weather alert

6.6 PA6: Capacity Building / Smart Workforce

The training and skill development of the employees are key requirements for an organization to
grow and be competitive in the marketplace. The electricity industry has evolved beyond just
engineering, and now requires executives with expertise in renewable energies, finance,
management, leadership, ICT and other areas. It is crucial for these technical and non-technical
executives to have sufficient knowledge of interdisciplinary issues to effectively support and
discharge their duties efficiently. Integration of disciplines such as business development, finance,

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consumer management and human resource management and others with technology is necessary
for the smooth functioning of the organization.
In addition, behavioral training for employees is important to promote a sense of belonging to the
organization and foster better appreciation for the interests of other stakeholders, as the
organization culture continues to evolve.
There are several capacity building programs available for power distribution utility workforce,
which aim to improve their skills, knowledge, and competencies. Here are some examples:

1. Technical training programs: These programs provide technical training on topics such
as maintenance, repair, and troubleshooting of distribution equipment, installation and
operation of smart grids, and grid modernization.
2. Leadership development programs: These programs aim to develop leadership and
managerial skills among the utility workforce, including topics such as team building,
communication, conflict resolution, and decision-making.
3. Safety training programs: These programs focus on promoting a culture of safety within
the utility workforce, including topics such as electrical safety, hazard recognition, and risk
management.
4. Apprenticeship programs: These programs provide on-the-job training and education to
individuals who want to become skilled electricians or linemen.
5. Professional development programs: These programs offer courses, seminars, and
certifications to enhance the knowledge and skills of utility workforce in areas such as
renewable energy, energy storage, and grid integration.
6. Knowledge sharing platforms: These platforms provide opportunities for utility
workforce to exchange knowledge, best practices, and lessons learned with their peers from
other utilities, academia, and industry experts.
7. Energy Market Training programs: These train the human resource for competitive
energy market.

Considering the above types of trainings and the modern interventions which are planned and
described in earlier sections, following trainings are proposed as part of the overall capacity
building program at MEPCO:
Table 6.4: Capacity Building Training Programs
Sr. Capacity Building Details of Trainings
No. Trainings
1. Renewable Energy training This training program will focus of RE technologies and their
program application int the distribution system. Some of the topics may
include;
• Renewable energy technologies and their applications
• Energy efficiency and conservation measures
• Policy and regulatory frameworks for RE
• Financing and investment options for RE projects
• Environmental impacts and sustainability of RE
technologies

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• Project management, planning and Analysis for RE

projects
• Forecasting of RE resource

2. ICT training program ICT training program will focus to help employees develop the
technical skills and knowledge base needed to effectively
manage and maintain the digital infrastructure. Topics may
include:
• Communication methodology and infrastructure
• IEC standard Communication protocols
• Data Analytics and visualization
• Project management, planning of ICT projects
• Cloud computing

3. Utility Business Suite This training program will focus on utility business suite
training program applications.
• ERP software
• Enterprise Asset Management (EAM)
• Work Force Management (WFM)
• Business Intelligence (BI)
• DMS, EMS etc.
4. Customer Engagement and This training program will ensure that effective use of social
Social Media management media is explained to the officials. Some topics may include:
for utilities training program • Developing a social media strategy for energy utility
• SMM tools and techniques
• Customer engagement methods
• SMM integration with CIS
• Measurement of success
• Advertising techniques
5. Grid Modernization training This training program should be conducted for maximum
program number of employees from all departments within a utility. This
program will cover extensive topics from planning,
development, operation, maintenance, innovations. The grid
modernization training will mostly focus on substation and
feeder automation.
6. Leadership Development Leadership Development training program for energy utilities
for energy utilities training will be designed to develop the leadership skills of current and
program future leaders in the power distribution industry. This program
can help to prepare employees for leadership roles within the
organization and to ensure that they have the skills and

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knowledge necessary to effectively manage teams and drive

business success. Some of the essential topics could include;
• Leadership principles and practices
• Talent/Team management
• Change and Innovation management
• Effective Communication
• Utility Business Management

7. Distribution System This training will focus on changing trends in distribution

Operation training program system operations due to inclusion of ICT , RE technologies
in distribution grid. Furthermore, it will enable them on how
to operate distribution network effectively through the use
of applications. This training will also cover the protection
aspect of the distribution network operations.

8. Cyber Security training A cybersecurity training program will cover a range of topics
program related to information security and cyber threats. Cybersecurity
training will help employees understand the importance of
protecting sensitive data such as power network data, customer
information, financial data, and intellectual property. It will
enable employees to recognize and respond to cyber threats such
as phishing attacks &malware.

9. Distribution system safety Distribution system safety management training program will
training program involve enabling the field staff to identify and manage and
rectify potential safety hazards associated with the distribution
system, such as electrical shocks, electrocution, and fires. This
will include implementing safety procedures and protocols to
minimize the risk of accidents or incidents, as well as
conducting regular inspections and maintenance of equipment
to ensure that it is in good working condition. The training
program will discuss at length the existing saftey programs and
improvement in them if required.

10. Human Resource With new expertise required due to changing trends in the
Management training power distribution utility, the human resource management
program also needs upgradation. This training will build their capacity
and skills for hiring the resource for future grid upgradation
and operation. Some of the key components of the training
shall be ;

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• Selective Recruitment
• Performance & Compensation Management
• Employee Retention
• Employee Development
• Diversity, Equity and Inclusion

11. Energy Market Due to start of CTBCM, energy market management has
Management Training become an important topic for power distribution companies of
Pakistan. Therefore, training on energy market mechanism as
well as risks and opportunities associated with is essential.
Additionally, topics such as energy market modelling and
analysis, energy market rules and regulations and its
commercial analysis shall be covered under this part of the
training.
Training and capacity building are essential for power distribution companies to prepare for future
technologies. As the energy industry rapidly evolves, distribution companies must adapt to new
technologies and business models.

6.7 PA7: Regulatory & Policy Support

6.7.1 Policy support for Innovative Business Model (Additional Revenue Streams)
There are several innovative business models that a power distribution company can adopt in
modern times to meet the evolving demands of customers and the changing energy landscape.
Specially with the use of grid modernization interventions, more business opportunities open up
which shall be explored for additional revenue generation. A few additional revenue generation
models are mentioned below;

Revenue through Data Monetization

Data monetization can be an innovative business model for power distribution utilities,
especially those that have invested in modern grid technology and other advanced data analytics
tools. Smart grids and other digital technologies generate large amounts of data on energy
consumption, system performance, and customer behavior, which can be valuable for a variety
of stakeholders, including energy retailers, marketers, researchers, and policymakers.

By selling this data to third-party companies, power distribution companies can create new
revenue streams and offset some of the costs associated with implementing smart grid
technology. For example, power distribution companies can sell data to energy retailers, who
can use it to develop more targeted marketing campaigns or offer more personalized energy
services to their customers. Researchers and policymakers can also use this data to better
understand energy consumption patterns and develop more effective energy policies.

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Figure 6.28: Flow of User Data Monetization

However, power distribution companies must ensure that they protect customer privacy and
adhere to data protection regulations when selling data. They must also be transparent about
the types of data being sold and how it will be used by third-party companies.

Revenue through Consumer subscriptions

By support the customers with powerful digital tools and services using machine learning
analytic platform allowing advance disaggregation and visualization of energy data,
enabling customer engagement services, activate/deactivate connections, energy trading,
autonomous benchmarking, push notification, alerts. The department can set-up charges and
fees for subscription of different activities and generate additional revenue.
• Customer engagement services, load-side management, and energy efficiency
• Energy trading e.g., RE-Wallet, RE-coins, virtual net-metering
• Web-Portal online Marketplace services
• Charging stations
Revenue Generation through EV Charging Services:
Some power distribution companies consider EV charging as different sources of revenue
generation. Not only the EV chargers will increase sale of energy, instead many power
distribution companies generate additional revenue through are offering managed charging
services to EV owners. These services include enabling V2G services and controlling the
charging of EVs to ensure that they are charged at times when electricity demand is low,
and renewable energy generation is high. This helps to balance the grid, reduce peak
demand, and maximize the use of renewable energy.
Revenue through Energy Efficiency Services:
Some power distribution companies offer energy efficiency services like energy audits,
energy-efficiency advisory to their consumers by charging a service fee.
Policy and regulatory assistance to enable these revenue generation models in addition to the
conventional sale of energy model shall be provided to MEPCO considering the use of technology
in the grid infrastructure.

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6.7.2 Policy Support for Privatization / Provincialization of the Organization

Government of Pakistan has been exploring options for the privatization of its distribution
companies to reduce the financial burden on the government and improve their efficiency.
It is worth noting that the privatization of centrally controlled and regulated distribution companies
is a complex process that requires significant planning and coordination. Any decision to privatize
them would need to consider various factors, including the legal and regulatory framework, the
financial health of the distribution companies, the potential impact on employees, and the overall
impact on the power sector in Punjab.
Therefore, a careful approach is to be adopted taking all stakeholder onboard. It is therefore
recommended that a policy exclusively for encouraging privatization should be formed at the
earliest which takes into account all these factors. The policy once in place will develop confidence
in the management, private investors, employees and others for smooth transitioning of the
process.
6.7.3 Policy support for Tariff Re structuring
NEPRA is responsible for determining electricity tariffs in Pakistan. Prior to the 2018 amendment
to the NEPRA Act, each distribution company in Pakistan had its own consumer-end tariff
determined by NEPRA based on their unique characteristics. These characteristics were related to
different parameters such as demand, supply, losses etc. Following the amendment of NEPRA Act
in 2018, NEPRA established a standard uniform tariff mechanism for distribution licensees that
are entirely owned and controlled by a shared shareholder, despite being distinct corporate entities.
These licensees are government owned Distribution companies. The implementation of a uniform
tariff mechanism contributes towards the inefficienct behavior of distribution companies.
6.7.3.1. Tariff for Consumers:
Even though the present tariff system is the uniform for all types of customers in the country,
however it takes into account the different categories of users, such as residential,
commercial, industrial, agriculture, and others. Additionally, it is divided based on the level
of consumption (tariff slabs), load, or the time of usage (peak and off peak tariff).
The cost of electricity for residential consumers increases as consumption levels rise. In the
highest slab, the price of electricity for residential consumers is higher than the supply cost.
This exist for single phase residential consumers. However, the tariff for agriculture tube
wells is heavily subsidized and remains constant. The system of electricity subsidies, cross-
subsidization across sectors and regions, and the inability to pass on actual costs to some
consumer categories are major concerns due to the inefficient use of resources and
distortionary effects associated with these subsidies and pricing structures.

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Figure 6.29: Comparison of Weighted Average Tariff with actually determined tariff
Source: Afia & Urooj
An analysis of the weighted average of tariffs (WATF) across various distribution
companies reveals that consumers in some companies, such as IESCO, LESCO, FESCO,
GEPCO, and TESCO, are paying more than their actual determined tariffs. Meanwhile,
consumers in other companies like SEPCO, PESCO, HESCO, and QESCO are being
subsidized by these overpaying consumers.
If a unique tariff is set for each distribution company, it could create incentives for
companies like SEPCO, HESCO, PESCO, and QESCO to improve their operations, while
companies like IESCO, GEPCO, and FESCO may continue to offer electricity at a lower
rate. However, a uniform tariff and subsidy policy leads to additional charges, taxes, and
tariff hikes for compliant consumers of good performing distribution companies, as is the
current situation.
According to the National Electricity Policy 2021, the uniform tariff policy will remain in
place, which means that the tariff differential subsidy will continue. However, the
government of Pakistan has plans to privatize state-owned distribution companies, as
discussed in the previous section. The uniform tariff policy may discourage investors from
taking over these distribution companies. Additionally, the ultimate goal of a wholesale
energy market like CTBCM is to create competition among market players to benefit
consumers in terms of service quality and pricing. However, there will be no competition if
the accounts of inefficient and efficient DISCOs are treated as one and a uniform tariff is
charged.
For example, if IESCO were to receive a separate tariff, it could potentially benefit from a
decrease in energy prices, resulting in an increase in energy sales and revenue generation.
To achieve this, a radical tariff restructuring may be necessary, such as exploring a linear
tariff model.
6.7.3.2. Tariff for Net Metered Distributed Generators:
Net Metering Regulations of NEPRA encourages use of Renewable Energy specifically
Roof Top Solar PV as distributed generators. The consumers get compensated through self-
consumption of local generation as well as export of excess energy back to the distribution
grid. It is worth mentioning that almost all of the net metered distributed generators generate

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energy during off peak period while import energy during the peak hour period. This means
that distributed generators, reduce the energy demand of MEPCO and have no effect on
peak power capacity demand.
This means that the capacity charges would have to be paid to the procured power plants
while energy demand is reducing thereby stressing the regulator to increase tariff.
Currently, the excess units generated by distributed generators are compensated by utilities
through tariff which is composed of Distribution Margin (DM), Use of system charges
(UoSC) and capacity charges. Distribution companies argue that UoSC and Capacity
charges shall be removed and only energy generation tariff in line with Solar IPP tariff shall
be provided to such Distributed Energy generators i.e.., approximately Usc 3.5-4 (equivalent
to PKR 10-12).

To address this issue, the regulator and MEPCO (along with other DISCOs) need to come
up with a more balanced net metering policy that takes into account the full cost of
distributed solar generation and ensures that the costs are borne by the appropriate parties.
This could include setting more appropriate purchase rates tariff that reflect the true value
of distributed solar generation, implementing grid integration requirements for net metering
facilities, and conducting detailed studies to understand the impact of distributed solar on
the distribution network and the associated costs.

While net metering has the potential to contribute to the growth of renewable energy and
reduce carbon emissions, it is important to ensure that the policies and regulations are
designed in a way that is fair and equitable to all stakeholders and takes into account the full
costs and benefits of distributed solar generation.

6.7.4 Policy /Regulatory support for CTBCM -MIRAD

Establishment of Market Implementation and Regulatory Affairs Department (MIRAD) within
MEPCO is a step forward towards successful implementation of the CTBCM regime of Pakistan.
NEPRA has formulated various detailed regulations and codes for carrying out registration and
procurement processed. However, there is a need for distribution company to develop their own
working procedures in order to ensure that the day-to-day business functions considering the
CTBCM are being carried out in line with standard processes. Some business functions are
mentioned below:
• Development of Procurement Action Plan
• Estimation of Cost of Supply (Use of System Charges) i.e., Tariff for Bilateral Agreements
• Procedures for review and approval of Bilateral Energy Agreements
• SOPs for monitoring the connected Generation with distribution network (Technically)
• Automating the workflow and documentation management system
• Developing forms and templates for reporting necessary stakeholders like Market
Operator, System Operator, Regulator etc.

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MEPCO has set up its MIRAD consisting of following:

Table 6.5: MEPCO MIRAD Positions
Sr. No. Position Nos. Of seats
1. Director General MIRAD 1
2. Manager (Legal / Contracts) 1
3. Manager Contract Management & Regulatory Affairs 1
4. Manager Planning & Forecasting 1
5. Deputy Manager (Legal / Contracts) 1
6. Deputy Manager Contract Management 1
7. Deputy Manager Demand Forecasting 1
8. Deputy Manager Finance 1
9. Deputy Manager Regulatory Affairs 1
10. Deputy Manager Transmission Planning 1
11. Assistant Manager (Admn) 1
12. Assistant Manager Contract Management 2
13. Assistant Manager Demand Forecasting 2
14. Assistant Manager Finance 2
15. Assistant Manager Regulatory Affairs 1
16. Assistant Manager Transmission Planning 2

Almost all the above positions are filled by utilizing existing human resources within MEPCO.
For effective functioning of the MIRAD, SOP are required to be developed. SOPs are essential for
the smooth functioning of any newly formed department like MIRAD, particularly in the energy
distribution company, which requires strict adherence to regulatory requirements. SOPs provide a
clear and concise outline of the processes and procedures required for carrying out tasks in a
consistent and efficient manner. They establish a standard of excellence and ensure that all tasks
are completed uniformly by all employees.

In the energy utility sector, where regulatory requirements are stringent, SOPs become even more
important. They ensure compliance with regulatory guidelines and policies, prevent safety hazards,
and eliminate errors and discrepancies. Properly defined rules, regulations, and processes are
necessary to establish a systematic approach for carrying out tasks. This helps in identifying
regulatory requirements that must be met and ensures timely and accurate completion of tasks.

SOPs must be written clearly and concisely, outlining the tasks to be performed, timelines, roles
and responsibilities, and regulatory requirements. They must be communicated to all stakeholders,
including employees, customers, and regulatory agencies, to ensure everyone is on the same page.
Furthermore, SOPs must be reviewed and updated regularly to ensure their effectiveness in
fulfilling the requirements.

Automating the documentation process can significantly enhance the efficiency and effectiveness
MIRAD. With the help of automation tools, such as document management systems, workflows,
and digital signatures, the department can automate the document creation, approval, and retention
processes. This ensures that the documentation is consistent, up-to-date, and easily accessible to
all stakeholders.

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In addition, automation tools can help to establish and enforce standard operating procedures and
ensure that rules, regulations, and processes are well-defined with proper timelines. For instance,
workflow automation can help to ensure that each document is reviewed and approved by the
relevant stakeholders within a specific timeframe. This can help to avoid delays in the approval
process and ensure that all regulatory requirements are met.

Furthermore, automation tools can help to reduce errors and inconsistencies in documentation,
leading to increased accuracy and improved compliance. These tools can also provide alerts and
reminders for upcoming deadlines or actions, helping the department to stay on top of regulatory
requirements and ensure that all necessary documentation is submitted on time.

6.7.5 Addressing Role of Union

Similar to other DISCOs of Pakistan, MEPCO has labor union. Labor unions engage in strikes,
picketing, or other forms of disruptive behavior to achieve their goals. These actions disrupt
business operations, create tension between workers and management, and harm the company's
reputation. In some cases, labor unions are prone to corruption, favoritism, or other forms of
unethical behavior, which can harm workers' interests and undermine the union's credibility.
Pakistan’s private sector employers do not have very good standing with labour and employees.
Their skepticism is not misplaced either.
Unions oppose privatization because it has negative effects on workers' wages, job security, and
working conditions. Since privatization refers to the transfer of ownership and control of public
assets, services, or functions to private companies the union feels that the new owner prioritizes
organizational profit over workers' interests.

Addressing the role of Union of MEPCO is necessary in order to improve the operational
capabilities. Furthermore, Unions have an important role to play in provincialization or
privatization of MEPCO. Therefore a policy reform is necessary to address their concern in order
to overcome any hurdle by such labor unions.

6.8. PA8: Electric Vehicle (EV) Grid Readiness

Pakistan’s National EV policy has set EV market penetration targets and calls for achieving 30%
of new sales of all passenger vehicles and 50% of two, three wheel and buses by 2030. Throughout
the world, EV growth has mainly been driven by four factors;
• Buying price of an EV
• Driving range
• Types of EV variants
• Accessibility & Reliability of Charging Infrastructure / Charging Station
Out of the above four, charging infrastructure is directly linked with a power distribution utility.
One of the biggest concerns for potential EV buyers is range anxiety - the fear that they will not
be able to find a charging station when they need it. This can be a major barrier to widespread

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adoption of electric vehicles. By building a robust public charging infrastructure network, we can
alleviate these fears and make electric vehicles a more viable option for more people.
Furthermore, a public charging infrastructure network can encourage the growth of the EV market
by enabling longer distance travel and reducing the need for people to install expensive home
charging stations. Thus, success of transitioning from ICE to EV depends on how quickly the
adequate charging infrastructure can be put in place to drive the EV adoption.
The development of a public charging infrastructure network is a complex endeavor that requires
the involvement of multiple stakeholders, including government agencies, private companies, and
power distribution companies. Power Distribution Utilities can play a significant role in building
and maintaining the infrastructure needed to support a robust EV market.

6.8.1 Role of Power Distribution Company in Promotion of EV:

6.8.1.1 Provision of Continuous Electricity:

One of the primary roles of a power distribution company in the development of public
charging infrastructure is to provide the necessary electricity to power the charging stations.
These power distribution utilities can work with charging station operators and other
stakeholders to ensure that the stations have the proper electrical connections, and that the
electrical grid can support the additional demand from EV charging.

6.8.1.2 Upgradation of Grid for Integration of Charging Station:

A Power Distribution company can also leverage its expertise in grid management to ensure
that the charging infrastructure is integrated into the existing electrical grid in a way that
maximizes efficiency and reliability. For example, power distribution company can use
smart charging technologies that allow the charging of EVs to be managed dynamically
based on grid conditions and demand. Most of the technologies as explained in 6.1 of this
chapter will also cover for grid upgrade required for EV integration. However, the EV
supply equipment (EVSE) is also required which includes EV chargers, control panels and
other auxiliary equipment. EVSE can be of two types ie., utility owned or consumer owned
equipment. Utility owned equipment is usually installed at public places.

Figure 6.30: Responsibilities in EV Charging Infrastructure

6.8.1.3 Optimal Placement of EV Charging Infrastructure:

The National EV Policy provides recommendation to have at least one DC fast charger
installed in every 3x3 km area. Thus, apart from other parameters like utilization based on

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commercial area, parking availability, the technical parameter related to a power distribution
company is the impact on the distribution feeder (and its associated assets) are also very
important. Placement of EV chargers without consultation with power distribution company
may cause technical difficulties during periods of high demand. Specially during the low EV
scenarios, distribution company shall look to find optimal locations without investing too
heavily on their own infrastructure. Distribution companies will have a significant role in
selection of optimal EV charger placement point.

Figure 6.31: EV Penetration at different points of the Distribution Network

6.8.1.4 Advanced Planning / EV Penetration Roadmap:

The increasing adoption of electric vehicles presents significant challenges for power
distribution companies. DISCOs need to be proactive in their approach to addressing the
challenges posed by EV charging infrastructure. With careful planning and implementation,
they can ensure that the grid can accommodate the growing demand for EV charging without
compromising network reliability. A roadmap for EV integration shall be developed which
shall cover all aspects from the distribution company viewpoint. This may involve market
assessment of EV and EV chargers. It shall include assessment of existing network and
identify nodes where EVs can be installed without grid upgrades. The roadmap shall also
cover impact on the distribution company’s network based on various EV penetration
scenarios. It shall also include innovative business models for generating additional revenue
streams for the company.

6.8.1.5 Development of Policies, Tariff Structure and Regulations:

Additionally, power distribution companies shall work with government agencies, regulator,
charging station vendors and other stakeholders to develop policies and regulations that
encourage the development of public charging infrastructure. For example, power distribution
companies can advocate for the inclusion of charging infrastructure requirements in building
codes, or work with regulators to ensure that charging infrastructure investments are
considered in utility rate-making proceedings. Moreover, it can work with manufacturers and
local vendors to prepare specifications of charging stations suiting the needs of local
community.

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7. ROADMAP FOR MEPCO

Subsequent to the previous section, this section formulates a strategy for the timeline for
implementation of the recommended actions. Moreover, this section will present a methodology
as to how to prioritize the implementation of interventions defined in previous chapter. Prioritizing
implementation actions in a roadmap requires a thoughtful and strategic approach to ensure that
the most critical and impactful actions are tackled first. This chapter shall be read in conjunction
with chapter 6.

7.1. ROADMAP STRATEGY:

The strategy we will use for formulating the roadmap shall be based on the levels of grid
modernization as well as the impact each initiative shall be addressing. We divide the level of
distribution grid modernization into four levels. Each level is explained below.
Level 0: Zero Automation
This level involves use of manual process with zero or close to zero automation processes.
Even if some automation interventions have taken place, they are used in silos without any
integrated approach. This is the situation of power distribution companies in most of the
developing countries.

Level 1: Substation Automation

This level involves the use of basic automation technologies, such as automated switches,
sensors, and monitoring systems within the distribution substation. This level enables
utilities to monitor and control the distribution grids remotely and detect faults within the
distribution substation more quickly, reducing outage times. This also enables utilities to
monitor the power transformer losses and reconcile energy loss due to transformation of
the voltages. This level will enable the development of station bus, process bus making the
substation interoperable with future digital communication technologies. Thus, this level
includes initial level of communication infrastructure implementation.

Level 2: Feeder Automation

This level involves the use of Feeder automation and remote-control build on level 1 by
extending remote monitoring and advanced control to the feeders themselves (outside the
substation fence). This level also includes installation of smart metering devices on feeder
equipment as well as consumer premises for improved visibility, control and decision
making by distribution operators. This will also involve advanced communication
infrastructure.

Level 3: Integrated Automation

This level involves the integration of advanced automation technologies, such as SCADA,
FLISR, EMS, GIS, CIS, distribution management systems (DMS), outage management
systems (OMS), and demand response systems. This level enables utilities to optimize the
distribution system, reduce outage times further, and respond to grid disturbances more
efficiently. It is to be noted that some application can be implemented at earlier levels,
however, this stage benefits the distribution company from heir integration. Furthermore,

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integration of existing applications (if implemented) can take place in parallel to other
initial levels.

Level 4: Renewable Energy Integration

This level involves the integration of distributed renewable energy resources, such as solar
PV, energy storage, and electric vehicles, into the distribution grid. This level enables
power distribution company to manage the variability and uncertainty of renewable energy
sources and improve the reliability and resilience of the grid. Although it is a fact that initial
percentages of RE can be integrated without the need of advanced level of grid
modernization, it must be noted that this level involves higher percentage of RE integration
into the distribution network.

Level 5: Advanced Analytics and Control

This level involves the use of advanced analytics and control technologies, such as artificial
intelligence and machine learning algorithms, to optimize the distribution grid's operation
and enhance its resiliency. This level enables utilities to predict and prevent grid
disturbances and optimize grid operation to reduce costs and improve efficiency.

As the distribution grid modernization levels advance from manual paper-based processes and
approach to computerized decision-making with automation, it's plausible and often advisable for
a power distribution company currently at a lower modernization level to skip one or more higher
automation levels. This implies that a power distribution utility with relatively basic modernization
can leapfrog one or more levels of grid modernization to acquire some of the benefits of the highest
modernization levels.

7.2. Vision:
Any distribution grid modernization plan is developed based on the vision of the distribution
Company. MEPCO is considered as one of the more advanced utility as compared to its counter
parts considering the implementation of advanced tools and systems (though in bits and pieces).
The challenge for MEPCO now is to progress in a channelized fashion towards evolution into a
modern and advanced distribution company. It is pertinent to mention that an advanced grid utility
does not mean digitalization or automation of its business processes. Instead, the major intention
for grid modernization is to improve grid management, enable grid for connectivity with existing
renewable energy sources as well as emerging technologies of future, enhance customer
experience (CX) and energy efficiency. Additionally, it means to improve the downtime and make
the grid flexible.
Keeping these in view the sector policies, plans (as introduced in section 3), the vision for MEPCO
is formulated using program/focus areas defined in chapter 6. The vision of MEPCO is redefined
as below:

Serve the citizens by providing reliable, affordable and sustainable electrical

energy via modernized and smart grid infrastructure

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7.3. Horizon:
The horizon of a roadmap refers to the time frame or period within which a roadmap is expected
to be implemented. It is the length of time that the roadmap is intended to cover and can vary
depending on the scope and complexity of the plan. The horizon of a roadmap is typically
determined by the organization's strategic goals and objectives, as well as the external factors that
may impact its operations. It is important to establish a clear horizon when developing a roadmap
to ensure that it aligns with the organization's long-term vision and remains relevant over time.
Most of the plans and policy in Pakistan’s power sector are long term with 10 years horizon. Some
plans have a horizon of 5 years as well. However, considering the bureaucratic nature of Pakistan’s
energy sector, it is a well-known fact that decision making requires more than usual time.
It is therefore decided that the overall horizon of the roadmap shall be kept at 10 years. However,
for monitoring purposes, the overall horizon is divided into 3 phase with first two phase of 3 years
while the last phases at 4 years.
The horizon will start from 2024-2033 covering a period of 10 years.

7.4. Roadmap Phases and RE Targets:

The three phases are aligned with RE targets of MEPCO. The phases are defined below.
Table 7.1: RE Penetration Phases
Phase Year Range RE Penetration Target
1 2024-2026 10%
2 2027-2029 15%
3 2030-2033 Above 15%

Additionally, each phase shall have a specific goal for implementation of the grid modernization
technology, along with loss reduction as well as customer service improvement targets.
Furthermore, for the sake of breaking down the physical implementation, targets shall be defined
in terms of number of substations, feeders, distribution transformers, consumers, etc. This will
ensure that monitoring the implementation of this Roadmap is made easy.

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It is important to mention that roadmaps are strategic plans that outline the steps needed to achieve
a specific goal or set of goals. These plans must be reviewed and updated regularly to ensure that
they remain relevant and effective. Changes in requirements, advancements in technology,
workforce development, time constraints, and budgetary constraints can all impact the success of
a roadmap. By regularly reviewing and updating the plan, stakeholders can ensure that they are
taking into account these factors and making the necessary adjustments to stay on track.

In addition, reviewing and updating the roadmap can help stakeholders identify potential
roadblocks or challenges that may arise during the implementation process. By anticipating these
challenges and adjusting the plan, stakeholders can increase the likelihood of success and reduce
the risk of delays or failures. Regular review and updating of roadmaps is essential to ensure that
they remain relevant and effective in achieving the desired outcomes.

As per National Electricity Plan Priority Area 5, the strategic roadmap shall provide targets for
following areas:

1. Reduction AT&C losses

2. Improvement in recoveries, on account of bill collection and theft reduction
3. Reduction in commercial loadshedding
4. Enhanced consumer services through reduction in number of consents / approvals
5. Development and Strengthening of Safety Management System
6. Deployment of SCADA at transmission networks of DISCO
7. Completion of GIS Mapping of Distribution Network
8. Phased Deployment of AMI in DISCO based on market transition and cost benefit.
9. Amendment and updating of respective HR manuals
10. Business Process Automation through ERP

Based on the above, program areas with interventions have been introduced in chapter 6. The
program areas are mentioned below.

7.5. Roadmap Program Areas (PA):

Roadmap consists of program areas (PA) as mentioned in Section 6. The Program Areas are
designated with the code PA. The program areas are then divided into projects (actions). These are
represented by code A. Therefore, any action to be implemented has the following coding
structure:
PA[no. of program area from 1 to 8]- A[no. of action]. For example, the deployment of SCADA
belongs to the second program area ie., Grid Efficiency, Reliability and resiliency and is the 6
action item therefore has the code of PA2-A6.

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Figure 7.1: Program Areas of Roadmap

7.6. Roadmap Strategic Targets:

These program areas cover the following strategic targets:

Table 7.2: Aligning Strategic targets with Program areas
Strategic Targets Program Areas which address the
targets
Reduction AT&C losses Grid Efficiency Reliability &
Resiliency, Decarbonization through
RE
Improvement in recoveries, on account of bill Grid Efficiency Reliability &
collection and theft reduction Resiliency, Enhanced Consumer
Experience
Reduction in commercial loadshedding Grid Efficiency Reliability &
Resiliency
Enhanced consumer services through reduction in Enhanced Consumer Experience,
number of consents / approvals Capacity Building
Development and Strengthening of Safety Capacity Building, Regulatory &
Management System Policy Support
Deployment of SCADA at transmission networks of Grid Efficiency Reliability &
DISCO Resiliency, Capacity Building

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Completion of GIS Mapping of Distribution Network Grid Efficiency Reliability &

Resiliency, Capacity Building
Phased Deployment of AMI in DISCO based on Grid Efficiency Reliability &
market transition and cost benefit. Resiliency, Enhanced Consumer
Experience
Amendment and updating of respective HR manuals Capacity Building
Business Process Automation through ERP Organizational restructuring, Capacity
Building

The program areas are further divided into projects (actions) for implementation. Each project
will be assigned a certain level of modernization as defined above. The level of modernization
will also depict the priority of the project to be implemented before another one.
Table 7.3: Mapping Recommended Actions with Grid Modernization Level
Grid
Program Areas Recommended Action - Projects Modernization
Level
A1: Constructing New Substation 0

PA1: Grid A2: Extensions / Remodelling / Augmentation 0

Enhancement
A3: Constructing New Distribution Feeders 0
A1: Volt/Var Optimization 2
A2: Fault Location Isolation & Service 2
Restoration
A3: Sectionalizers, Reclosers, Sensors, 2
Automatic Switches
A4: Deployment of Communication 1
PA2: Grid Infrastructure
Efficiency, A5: Deployment of Sensors / Field Devices 2
Reliability & 1
Resiliency A6: Deployment of SCADA
A7: Deployment of Enterprise GIS 1

A8: Deployment of DMS / EMS 3

A9: Deployment of DTMS 4

A1: Deployment of MDMS 3

A2: Deployment of Smart Meters Consumers 2

PA3: Enhanced
Consumer A3: Deployment of Smart Meters Distribution 2
Experience Transformers

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A4: Consumer Engagement Programs 3

A5: Customer Information System 3

A1: Hosting Capacity Analysis 4

A2: Distributed Energy Resource Management 3

PA4: System
Decarbonization
through Renewable A3: RE Planning, Forecasting & Analysis Tool 4
Energies
A4: Establishment of Microgrids within 4
Service Territory
A1: Establishment of ICT Department 2

A2: Establishment of RE Department 4

PA5:
A3: Social Media Management Department 3
Organizational
Restructuring
A4: Dedicated Cloud 2

A5: Business Suites 3

A1: Capacity Building ICT 3

A2: Capacity Building RE 3

PA6: Capacity
Building A3: Capacity Building Business Suites ERP 3

A4: Capacity Building CX / SMM 3

A5: Capacity Building Cyber Security 3

A6: Capacity Building Safety & Operations 3

A7: Capacity Building Leadership 3

A8: Capacity Building Energy Market / 3

MIRAD
A9: Capacity Building AMI 3

A1: Innovative Business Model -

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A2: Privatization / Provincialization -

PA7: Regulatory &
A3: Addressing Role of Unions -
Policy Support
A4: MIRAD / CTBCM
A5: Tariff Restructuring -

PA8: EV Readiness A1: Actions Supporting EV Readiness 4

It is reiterated that a utility may initiate an intervention of a higher level of grid modernization,
without following the order of the modernization level. It must also be mentioned that some of the
interventions have already been started at MEPCO like Distribution Transformer Monitoring
System (DTMS) and some pilot implementation of smart meters. the reason for including them
here is to ensure that these interventions are planned for full scale implementation across the
MEPCO’s whole power distribution network. Similarly, MEPCO has already initiated GIS
mapping activity (which is completed for its 11kV network and ongoing for its LV network). The
inclusion of such activities in the roadmap will ensure that during the monitoring of the
implementation of the roadmap, these are not ignored.

7.7. Impact of Grid Modernization

The impact of grid modernization initiatives is an important aspect and should be made part of the
overall roadmap. Quantifying the impact of advanced grid technologies can be challenging due to
the complexity of the electric distribution grid and the range of potential benefits. Based on the
challenges we faced by MEPCO, the following areas need to be addressed by MEPCO.
1. Improve efficiency and decrease AT&C losses
2. Improve Reliability and reduce downtime
3. Integration of RE and other technologies (EV, Storage, etc.)
4. Enable Flexibility and induce Demand Response
5. Increase Revenue Generation & Business Intelligence
Table 7.4: Impacts and Actions effecting the impact
Impacts Actions making the impact
Improve efficiency and decrease AT&C losses Deployment of MDMS, Deployment of Smart
Meters Consumers, Deployment of Smart
Meters Distribution Transformers, Volt/Var
Optimization, Sectionalizers, Reclosers,
Deployment of Sensors / Field Devices,
Deployment of SCADA, Deployment of
DMS / EMS

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Improve Reliability and reduce downtime Deployment of Smart Meters Distribution

Transformers, Customer Information System,
FLISR, Sectionalizers, Automatic Switches
Reclosers, Deployment of Communication
Infrastructure, Deployment of Sensors / Field
Devices, Deployment of SCADA
Integration of RE and other technologies (EV, Sectionalizers, Automatic Switches Reclosers,
Sensors, Deployment of Communication
Storage, etc.)
Infrastructure, Deployment of Sensors / Field
Devices, Deployment of GIS, Hosting
Capacity Analysis,
RE Planning & Analysis Tool, EV Readiness

Enable Flexibility and induce Demand Deployment of MDMS, Deployment of Smart

Response Meters Consumers, Deployment of Smart
Meters Distribution Transformers,
Sectionalizers, Reclosers, Automatic Switches
Deployment of Communication
Infrastructure, DERMS,
Increase Revenue Generation & Business Deployment of MDMS, Deployment of Smart
Meters Consumers, Consumer Engagement
Intelligence
Programs, Customer Information System,
FLISR, Deployment of GIS, Deployment of
DMS / EMS, Establishment of Microgrids
within Service Territory, Innovative Business
Model, Establishment of ICT Department,
Establishment of RE Department,
Social Media Management Department,
Dedicated Cloud,
Business Suites, Tariff Restructuring,
Privatization / Provincialization, Addressing
role of Unions, Capacity Building

The roadmap actions along with targets, shall be mapped directly with the impact they create.

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7.8. Priority of Actions:

Prioritization of actions is essential to ensure the smooth and effective implementation of the
roadmap. It will provide management, planners, international and national funding agencies with
a clear picture of where to invest, when to invest , what impact will the initiative have. Prioritizing
actions on a roadmap can be a complex process that involves balancing various factors such as
company strategy, market trends, customer needs, resource availability, and project dependencies.
A prioritization matrix is a tool used to help make decisions about how to allocate resources and
prioritize tasks or actions based on their importance or impact. It is used in situations where there
are multiple tasks or actions to be completed and there is a need to prioritize them based on their
relative importance or impact. We develop a prioritization matrix in this part to view the priority
order of implementation of the grid modernization actions defined above.
Using methodology of six sigma, a prioritization matrix is established. The actions mentioned
above are mapped against the five-impact area. The relationship strength is established between
actions and the impact areas. Four relationship strength criteria are used as below, and association
score is assigned:
Table 7.5: Association Score based on relationship strength
Association Score Relationship Strength

9 Strong
3 Moderate
1 Weak
0 No

The impact areas are assigned numbers between 1-10 based on their importance to the
organization. Subsequently, weighted average score is established and priority levels are assigned
in the matrix. Priority level 1 depicts that it is first to be implemented while higher priority levels
show that the implementation of actions can be delayed.
It must be reiterated that actions having a higher level of modernization or implementation priority
score can be carried out earlier as well. Furthermore, actions relating to capacity building have not
been included in assigning the priority level due to the fact that capacity building of human
resources is a continuous process, and it is believed that capacity building programs shall be
implemented throughout the roadmap period. Various capacity building programs shall be
developed and funded to enhance the understanding of the existing work force regarding the
modern technologies.
The Prioritization Matix is given below:
Table 7.6: Recommended Action Prioritization Matrix

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Integration
Improve
Improve of RE and Enable Increase
efficiency
Reliability other Flexibility Revenue
Program and Weighted Priority
Projects (Actions) and technologies and induce Generation
Areas decrease Scores Levels
reduce (EV, Demand & Business
AT&C
downtime Storage, Response Intelligence
losses
etc.)

10 8 9 8 9
PA1: Grid Enhancement

A1: Constructing New

Substation

A2: Extensions / Remodeling / These actions are kept out of priority as these are mandatory for capacity
N.A. 1
Augmentation enhancement of the distribution network of MEPCO

A3: Constructing New

Distribution Feeders
PA2: Grid Efficiency, Reliability & Resiliency

A1:Volt Var Optimization 9 9 9 3 1 258 3

A2: Fault Location Isolation &
Service Restoration 3 9 0 1 3 137 14
A3: Sectionalizers, Reclosers,
Sensors, Automatic Switches 3 9 9 9 3 264 2

A4: Deployment of
3 9 9 3 3 216 6
Communication Infrastructure

A5: Deployment of Sensors /

9 9 9 3 1 258 3
Field Devices

A6: Deployment of SCADA 3 9 9 3 3 216 6

A7: Deployment of Enterprise

1 1 3 1 9 128 18
GIS

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A8: Deployment of DMS /

3 3 3 3 9 180 11
EMS

A9: Deployment of DTMS 9 9 3 3 1 216 6

A1. Deployment of MDMS 3 1 3 3 3 110 21

PA3: Consumer Satisfaction

A2: Deployment of Smart

3 3 1 9 9 214 7
Meters Consumers
A3: Deployment of Smart
Meters Distribution 9 9 3 3 1 216 6
Transformers
A4: Consumer Engagement
0 1 0 3 3 59 22
Programs
A5: Customer Information
0 1 0 3 9 113 19
System

A1: Hosting Capacity Analysis 3 3 9 1 1 134 15

PA4: Decarbonization

A2: Distributed Energy

through RE

1 3 9 1 9 186 9
Resource Management System
A3: RE Planning, Forecasting
1 1 9 3 9 186 9
& Analysis Tool
A4: Establishment of
Microgrids within Service 3 3 9 1 9 206 8
Territory
A1: Establishment of ICT
PA5: Organizational Re

1 3 9 9 9 250 4
Department
A2: Establishment of RE
structuring

3 3 9 9 3 216 6
Department
A3: Social Media Management
1 1 1 9 9 178 10
Department

A4: Dedicated Cloud 1 3 9 9 9 250 4

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A5: Business Suites 3 3 3 9 9 228 5

A1: Capacity Building ICT 9 9 9 9 9 297 1

A2: Capacity Building RE 9 9 9 9 9 297 1

A3: Capacity Building Business

9 9 9 9 9 297 1
Suites ERP
PA6: Capacity Building

A4: Capacity Building CX

9 9 9 9 9 297 1
/SMM
A5: Capacity Building Cyber
9 9 9 9 9 297 1
Security
A6: Capacity Building Safety &
9 9 9 9 9 297 1
Operations
A7: Capacity Building
9 9 9 9 9 297 1
Leadership
A8:Capacity Building Energy
9 9 9 9 9 297 1
Markets / MIRAD
A9: Capacity Building AMI 9 9 9 9 9 297 1

164
A1: Innovative Business Model 3 1 3 3 9 13
PA7: Regulatory &
Policy Support

A2: Privatization / 166

Provincialization 3 3 1 3 9 12
1 1 1 1 3 60 20
A3: Addressing Role of Unions
A4: MIRAD / CTBCM 3 3 9 9 3 216 6

A5: Tariff Restructuring 1 1 1 3 9 130 17

Readiness
PA8: EV
Grid

A1: Actions Supporting EV

1 1 9 3 3 132 16
Readiness

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7.9. Implementation Strategy for MEPCO:

This section rearranges the recommended actions in ordered form, keeping the high priority
action up in the list. The table is self-explanatory and highlights the required action status.
Table 7.7: Recommended Action sorted priority wise
Program Actions Status
and Priority Required
Projects
Action Rank
Code
PA1-A1 Constructing New Substation 1
PA1-A2 Extensions / Remodeling / Augmentation 1 Mandatory
PA1-A3 Constructing New Distribution Feeders 1
PA6–A1 Capacity Building ICT 1
PA6–A2 Capacity Building RE 1
PA6–A3 Capacity Building Business Suites ERP 1
PA6–A4 Capacity Building CX /SMM 1
PA6–A5 Capacity Building Cyber Security 1
PA6–A6 Capacity Building Safety & Operations 1 Immediate
PA6–A7 Capacity Building Leadership 1 Implementation
PA6–A8 Capacity Building Energy Market / MIRAD 1 Required
PA6–A9 Capacity Building AMI 1
PA2-A3 Sectionalizers, Reclosers, Automatic Switches 2
PA2-A1 Volt/Var Optimization 3
PA2-A5 Deployment of Sensors / Field Devices 3
PA5-A1 Establishment of ICT Department 4
PA5-A4 Dedicated Cloud 4
PA5-A5 Business Suites 5
PA3-A3 Deployment of Smart Meters Distribution Transformers 6
PA2-A4 Deployment of Communication Infrastructure 6
PA2-A6 Deployment of SCADA 6
PA2-A9 Deployment of DTMS 6
PA5-A2 Establishment of RE Department 6
PA7-A4 MIRAD/CTBCM 6 Immediate Planning &
Subsequent action
PA3-A2 Deployment of Smart Meters Consumers 7 Required
PA3-A1 Deployment of MDMS 7
PA4-A4 Establishment of Microgrids within Service Territory 8
PA2-A2 FLISR 9
PA4-A2 DERMS 9
PA4-A3 RE Planning, Forecasting & Analysis Tool 9
PA5-A3 Social Media Management Department 10
PA2-A8 Deployment of DMS / EMS 11
PA7-A2 Privatization / Provincialization 12
PA7-A1 Innovative Business Model 13

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PA4-A1 Consideration &

Hosting Capacity Analysis 15 Consensus required by
Stakeholder
PA8-A1 Actions Supporting EV Readiness 16
PA7-A5 Tariff Restructuring 17 Actions required but
PA2-A7 Deployment of Enterprise GIS 18 depend on
PA3-A5 Customer Information System 19 implementation of
PA7-A3 Addressing Role of Unions 20 earlier actions
PA3-A4 Consumer Engagement Programs 22

7.9.1 Implementation Strategy Priority Level 1-5:

This section shall be read in conjunction with chapter 6 to understand the necessary actions
required to be taken for MEPCO.
PA1 Grid Enhancement
PA1-A1 Constructing New Substations
MEPCO not only requires distribution grid upgrades rather more importantly, but it also needs to
build new substations in order to supply increased energy as forecasted. Moreover, reducing grid
congestion also requires development of new grid stations. The STG as mentioned in Chapter 6 is
planned by MEPCO plans to install 24 new grid stations by 2027 with an increase in capacity by
1098 MVA. The substations will require 69 new transmission lines to be built with a total length
of 1651 km. The schedule is presented in Table 6.1 which is reproduced below.
Description Unit 2022-23 2023-24 2024-25 2025-26 2026-27 Total
New Grid Stations No. 3 3 6 8 4 24
MVA 1098
Extension /Addition No. 12 6 8 10 7 43
MVA 275
Augmentation of Power No. 6 10 8 7 9 40
Transformers MVA 80
Transmission Lines No. 11 3 15 18 24 69
km 277 54 246 339 705 1651
Line Bays No. 7 6 16 11 9 49

Capacitor Banks No. 4 2 4 5 15

Beyond 2027 it is expected that further grid stations will be required. The same shall be added into
the roadmap as and when planned. The priority for implementation of this task is high and
mandatory.

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PA1-A3 Constructing New Distribution Feeders

This action contributes towards the addition of new distribution feeders and associated distribution
transformers and infrastructure for distribution of power at consumers premises. The plan prepared
by MEPCO is to be approved by the regulator. The expansion and rehabilitation works of HT
(11kV) and LT (0.4kV and below) network is planned as provided in tables below:
Table 7.8: Expansion Plan MEPCO HT & LT Networks
2023- 2024-
Year 2025-26 2026-27 2027-28 Total
24 25
11kV HT Lines Rehabilitation
Number of proposals Nos. 58 93 82 70 67 370
0.4kV LT Lines Rehabilitation
Number of proposals Nos. 460 440 450 450 455 2255
ABC Cable
Length Km 48 53 59 59 62 281
Augmentation of
Overloaded Transformers
Transformers Nos. 904 949 996 990 1050 4889
Energy Meters
Meters Nos. 340203 357213 375073 365720 372450 1810659
Source MEPCO

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Table 7.9: Rehabilitation of HT & LT Networks

Quantities

2023-24

2024-25

2025-26

2026-27

2027-28

Total
Description Unit

A. Scope of Work for 11 kV and Below Rehabilitation

1 Rehabilitation of HT Lines
Number of proposals Nos 58 93 82 70 67 370
Bifurcation Km 812 1302 1148 980 938 5180
Reconductoring Km 696 1116 984 840 804 4440
2 Replacement of Overloaded Transformers / Extension
a. 50 KVA Nos 280 224 230 230 232 1195
b. 100 KVA Nos 195 172 176 176 177 895
c. 200 KVA Nos 60 44 45 45 46 240
d. others KVA Nos
Sub Total Nos 535 440 450 450 455 2330
3 Replacement of Over loaded Transformers /Augmentation
a. 50 KVA Nos 208 313 329 327 347 1523
b. 100 KVA Nos 184 275 289 287 305 1340
c. 200 KVA Nos 275 247 259 257 273 1311
d. others KVA Nos 237 114 120 119 126 715
Sub Total Nos 904 949 996 990 1050 4889
Replacement of 11KV 58 93 82 70 67 370
4 Panel Nos
B. Scope of Work for LT Rehabilitation
New LT Lines Km 138 132 135 135 137 677
Number of Proposals Nos. 460 440 450 450 455 2255
Reconductoring of Km 55 53 54 54 55 271
new LT line
Source: MEPCO

PA1-A2: Extensions, Remodeling and Augmentations

"Network extension and remodeling" typically refers to the process of expanding or reconfiguring
the physical infrastructure of the distribution grid, such as adding new distribution lines or
upgrading existing ones, to improve the overall reliability and efficiency of the system. This is a
cost-effective way to delay new capacity addition investment. MEPCO has planned network
extensions and remodeling as well as transformer augmentation. Augmentation involves upgrading
the transformer by installing additional transformers to meet increasing demand or by replacing
the transformer with higher capacity ones. As per MEPCO STG, 355MVA of capacity is to be
enhanced through extension, remodeling and augmentation of the network till 2027.

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The MEPCO planned network extension is kept at priority 1 due to mandatory upgrades required
for capacity additions, congestion improvement, reliable and quality supply of energy.

Capacity Building (PA6–A1, PA6–A2, PA6–A3, PA6–A4, PA6–A5, PA6–A6, PA6–A7, PA6–A8, PA6–A9):

Capacity building actions in priority level 1 indicate the importance of human resource knowledge
and skill development. Capacity building is essential to ensure that individuals or organizations
have the skills, knowledge, and resources needed to achieve the targets of the organization. Starting
capacity building at the beginning of a project or initiative can help to build a strong foundation
for success. It can be particularly useful during periods of change or growth, such as when an
organization is undergoing a transition period, for example in this case from a conventional utility
to a modern one.
Since capacity building can help to ensure that individuals of MEPCO are equipped to take
advantage of new opportunities, technologies and navigate challenges, therefore, it is kept at the
highest level of priority. Transitioning from conventional to modern utility requires upgradation of
employees through rigorous Capacity building programs. Therefore, under this roadmap, capacity
building is kept at priority 1 and will be carried out continuously throughout the length of the
roadmap. It will cover all 3 phases. Moreover, it shall be ensured that all departments are covered
under the capacity building programs.
PA2-A1 Volt / Var Optimization:
Integrated VVO aims to improve the overall performance of the distribution system by
coordinating the actions of all voltage and VAR control devices. By sharing information and
optimizing control strategies at a system level, the resulting control actions can be more effective
and efficient, leading to better voltage regulation, reduced losses, and improved reliability. VVO
can reduce electrical losses by switching capacitor banks on or off to compensate for reactive
power drawn by the distribution feeders. Switching in a capacitor bank reduces the amount of
reactive power. This reduces the current flow on both the transmission and distribution systems
and, as a result, reduces the nontechnical losses given by the formula I2R.
Initially Volt Var Control techniques were deployed in substations which in modern distribution
companies have converted into Volt Var Optimization. The deployment involves optimal
placement of voltage regulators, capacitor banks, power factor correction devices, shunt devices
etc.
In case of MEPCO, there are 1726 11kV feeders. For Volt Var Optimization at MEPCO, the
following steps need to be carried out.
• Optimal study for placement of these devices shall be carried out along with economic
analysis prior to its placement. The study shall involve feeder selection along with ideal
placement of the device.
• Pilot project shall be implemented on a few selected feeder and results shall be recorded.

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• Subsequently, procurement and deployment plan shall be finalized.

The deployment is kept in phase 1 of the roadmap during the first three years i.e., 36 months
starting from 2024.
PA2-A5 Deployment of Field Devices and Sensors:
Sensors have been used in some of the key areas of the distribution systems (e.g., overhead
distributed feeders, underground cables, associated feeder equipment, distribution transformers,
insulators and lightning arrestors, distribution substations equipment, power transformers, and
circuit breakers, battery systems). Sensors form an important input facing part for the remote
terminal units (RTUs) and phase measurement units (PMUs) in a Supervisory control and data
acquisition (SCADA) system.
As mentioned in earlier chapters, demand of MEPCO will increase twice as compared to current
power demand, there this increase requires expansion MEPCO distribution network. Additionally,
this increase in demand also calls for an increase in the reliability, efficiency, and security of the
systems. Therefore, it has become imperative for the MEPCO traditional distribution grid to
expand its capacity and make space for penetration of newer technologies such as distributed
generation, renewable energy sources, power electronic devices, intelligent control systems,
sizeable storage devices, and electric vehicles.
Various types of sensors are needed to be deployed prior to full scale implementation of SCADA
at MEPCO. Faulty Circuit Indicators (FCI) and general-purpose sensors are required to be installed
at different locations across MEPCO network. It is also to be noted that most of the sensors are
embedded in intelligent electrical devices (IEDs) within substation. In such instances, maximum
usage of such sensing functionalities shall be exploited. For MEPCO network, following steps
shall be taken to deploy sensors at critical points:
• Study shall be carried out for technology of sensors suitable for MEPCO network and its
optimal deployment across the network. The study shall identify locations for effective
monitoring of grid parameters. These shall also form input to the outage management
system (OMS).
• Procurement & Deployment Plans shall be finalized subsequent to the study above.
• Pilot Project on a single feeder to be implemented (this can be done earlier prior to study
as well).
• Full scale roll out ie., Installation and operation and monitoring shall be followed.
• The input shall be linked to the central SCADA system of MEPCO.
The time frame for this activity is kept at 36-48 months of phase 1.

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Figure 7.2: Sensors installed at different locations of the distribution grid

Source: Swain, A.; Abdellatif, E.; Mousa, A.; Pong, P.W.T. Sensor Technologies for Transmission and Distribution
Systems: A Review of the Latest Developments. Energies 2022, 15, 7339

PA5-A1 Establishment of ICT Department and PA5-A4 Dedicated Cloud:

Establishing an ICT department at MEPCO becomes mandatory once the deployment of grid
parameters sensing devices have taken place and are commissioned. In fact, a team consisting of
communication experts shall be formed in parallel to deployment of Volt Var devices and field
sensors. The ICT team shall formulate the framework for laying the foundation of communication
infrastructure for the utility to transport real time data and information recorded from field to the
data centers of the dedicated cloud. The framework will ensure which technology is suitable for
transmitting and receiving this information at the distribution control centers. Additionally, the
framework will also ensure that how private sector can invest in establishing the communication
infrastructure.

Furthermore, due to transferring of large amount of field data, MEPCO needs to dedicate a cloud
for hosting the data and the applications for data analytics. Keeping in view Pakistan’s cloud first
policy (mentioned in chapter 3), MEPCO shall move towards hosting its data in a public or private
cloud specifically for management of MEPCO’s data.

MEPCO needs to follow the following steps:

• Approval from BOD for creating a specialized department
• Creation of positions in ICT department
• Hiring of Experts in ICT department
• Developing ICT framework for MEPCO
• For cloud services, MEPCO needs to assess data hosting requirements considering factors
such as the amount of data need by MEPCO to store, the requirement of level of security
and budget requirement. ICT tea shall be responsible for this task.
• Selection of a cloud service provider; Public or Private. The ICT team shall lead this task.

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• Selection of models for attaining cloud services ie., IaaS, PaaS or SaaS (as defined in
chapter 6).
• Configuration of cloud environment, transfer of data and ensure cyber security protocols
are followed.
• Ensure that cloud is scalable.

The time frame for both these activities is kept at 18-24 months of phase 1.

PA5-A5 Implementation of Business Suites- ERP:

Data silos in power distribution utility refers to situations where different departments or business
units within the organization operate independently, with little or no integration of data between
them. This can result in data being stored in separate systems or databases, making it difficult to
access and use for reporting and analysis purposes. It can safely be said that data silos is
particularly prevalent in MEPCO due to limited resources and infrastructure and requires
immediate addressal.

However, it is encouraging to mention that MEPCO has already initiated implementation of

business suite (ERP) application using SAP. However, for full benefits of the any business suite,
fullscale implementation is necessary. It is pertinent to mention that implementation of ERP is a
solution that integrates various business processes and data into a single, centralized system. ERP
implementation is a continuous and evolutionary journey for any organization.

One of the major advantages of ERP at MEPCO will be the advancement it shall bring in cross
sectional reporting within its departments. Cross-sectional reporting presents a unified view of an
organization's data across different departments and business functions. It enables customizable
reporting tools, real-time data presentation, and other data visualization tools.

For example, suppose MEPCO wants to analyze the performance of its distribution network across
its different operational circles. MEPCO may use cross-sectional reporting to compare data on
energy consumption, distribution losses, and customer complaints across the selected operational
circles. To generate this report without using Integrated tool or and ERP system (Business Suite),
MEPCO would have to gather data from various sources, such as:

• Smart Meter data from MDMS

• The organization may use data on maintenance schedules and repair histories to analyze the
reliability and performance of the distribution network in selected regions.
• Customer data, such as billing and payment information, to analyze customer complaints and
satisfaction levels within the operational circles.

The manual collection of the above data will be time-consuming and error prone. However, using
an ERP system or other data integration technologies, MEPCO can integrate data from these
different sources to generate a cross-sectional report that provides a comprehensive view of the
distribution network's performance across its operational circles.

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The cross-sectional report may show that one region has higher energy consumption but lower
distribution losses, while another region has lower energy consumption but higher customer
complaints. This can help the MEPCO identify areas where improvements are needed and make
more informed decisions about resource allocation and investment.

Currently, MEPCO has implemented following modules:

• SAP Project Systems (PS)

• SAP Financial Accounting & Controlling (FICO)
• SAP Material Management (MM)
• SAP Human Capital Management (HCM)

Apart from these some other necessary modules which are essential for energy utilities are
following and MEPCO must initiate implementation on these modules:

• SAP Business Intelligence

• SAP Enterprise Portfolio and Project Management (EPPM)Modules are following:

• SAP Enterprise Asset Management (EAM) Modules are following:

MEPCO shall develop a strategy to digitalize and automate its business process. It shall
integrate its each department to develop a cross-sectional reporting mechanism.
The time period for this action is kept at 36 months. However, this can be delayed till
establishment of ICT section as well as dedicated cloud. The current contractual obligations
can proceed as usual. Therefore, the starting period will be kept at 2025.

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PA7-A4 Policy support to MIRAD / CTBCM:

This action provides support to Market Implementation and Regulatory Affairs Department
(MIRAD). MIRAD is a department that has been established in all Distribution Companies of
Pakistan. The main objective of MIRAD is to implement the Competitive Trading Bilateral
Contract Market (CTBCM) in Pakistan. CTBCM which is a new wholesale electricity market, has
been launched in June 2022. Accordingly, MEPCO’s MIRAD is responsible for a number of tasks
related to the implementation of CTBCM.
MIRAD is a key player in the implementation of CTBCM in Pakistan. It is expected to play a
vital role in ensuring the success of CTBCM. However, due to CTBCM being in its early stages,
MIRAD faces some complex tasks. Some of policy and regulatory support is required under this
action are mentioned below with timeline:
• Demand Forecasting
• Nodal Analysis for Connectivity of Suppliers at various nodes of Distribution System
• Tariff Calculation Methodology including Use of Distribution System Charges
• Calculation Methodology of Cross Subsidy Service and its effect
• Communication Plan for communicating with various stakeholders i.e., Suppliers,
Regulator, System Operator, Market Operator, Transmission Network Company
• Risk Management to cater for over procurement
• Regulatory compliance methodology through use of business suites/ERP
• Market Monitoring for tracking market prices of various technologies, volume of energy
traded periodically and other market indicators
The above tasks are divided into 4 categories i.e., Technical, Commercial,
Regulatory/Compliance
Type of Support Description Timeframe
Technical • Demand Forecast 18 months
• Nodal Analysis
Commercial • Tariff Calculation for various 18 months
technologies
• Distribution Service Charges
Calculation
Regulatory /Compliance • Regulatory Compliance 18 months
• Communication Strategy
Risk Mitigation • Market Monitoring 30 months
• Risk Management
• Negotiation Methodology

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7.9.2 Implementation Strategy Priority Level 6-10:

PA3-A3 Deployment of Smart Meters at Distribution Transformers / PA3-A2 Consumers
and PA2-A9 DTMS:
This action requires the deployment of smart meters on distribution transformers and then
subsequently on all consumer premises. Details of total no. of distribution transformers and
consumers in MEPCO service territory are below:
Table7.10: No. of Distribution Transformers and consumers in MEPCO

Total DT Total Consumer

2,30,343 7,913,276

The consumers and Distribution transformers are divided into operational circles as follows:
Table 7.11: Circle wise No of consumers and distribution transformers of MEPCO

Circle Multan DGK Vehari B/pur Sahiwal RYK MGarh BNaga KWL Total
r
Consumers 1.23 0.72 0.69 1.12 0.91 0.88 1.06 0.62 0.65 7.91
DTs 31,394 17,422 25544 36627 33044 25742 23616 16850 20104 230,343
Note: DGK=Dera Ghazi Khan; B/Pur = Bahawalpur; RYK=Rahim Yar Khan; Mgarh = Muzafargarh; BNagar=Bahawalnagar;
KWL= Khanewal

For a complete tree structured automated metering of the distribution sector, 8.14million metering
points need to be equipped with smart meters (DT + Consumers). This will ensure that the energy
consumption and load profile pattern is monitored from source to consumption.
The following is proposed under this action:
• All Distribution Transformers shall be equipped with Smart meters with connectivity to the
MDMS. The smart meter shall be built in with the Distribution Transformer Monitoring
System (DTMS) which monitors the health of transformer and also the power flow
parameters like current, voltage, power consumption. This will ensure visibility for
distribution system operators. With increase in net metering at 11kV feeder level, the
DTMS system shall facilitate the Net metering department in cancellation of applications
in case a feeder is injected with excessive distributed generation.
• Circle wise implementation of DTMS system (with smart meter) shall be carried out.
Moreover, feeders with higher losses shall be selected and DTMS shall be deployed on
DTs of these feeders.
Table 7.12: Circle Wise Distribution Transformers and duration of DTMS implementation
Circle DTs Implementation Months
Multan 31,394 2024-2026 36
Dera Ghazi Khan 17,422 2024-2026 36
Vehari 25,544 2024-2026 36
Bahawalpur 36,627 2024-2026 36
Sahiwal 33,044 2024-2026 36

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Rahimyar Khan 25,742 2024-2026 36

Muzaffargarh 23,616 2024-2026 36
Bahawalnagar 16,850 2024-2026 36
Khanewal 20,104 2024-2026 36

For Smart Meter Deployment at consumer premises, following strategy can is recommended:
• Starting from 2024, at any new consumer connection, smart meter shall be deployed
• Similarly, any faulty meter shall be replaced with smart meter
• The above recommendations will ensure that less burden is placed on MEPCO for
replacing conventional meters with smart meters.
• For existing consumers, a phase-wise approach shall be adopted.
• At first instance all Commercial & Industrial consumers shall be converted to smart
metering /AMI metering. Total C&I consumers in MEPCO are 964,723
• Remaining consumers can be added circle wise as follows:
Table 7.13: Circle wise consumers of MEPCO and duration for smart meter deployment
Circle Consumers Implementation Months
Multan 1,238,679 2024-2027 48
Dera Ghazi Khan 723,183 2024-2026 36
Vehari 694,127 2024-2026 36
Bahawalpur 1,128,861 2024-2027 48
Sahiwal 907,230 2024-2027 48
Rahimyar Khan 887,810 2024-2027 48
Muzaffargarh 1,056,260 2024-2027 48
Bahawalnagar 620,793 2024-2026 36
Khanewal 656,333 2024-2026 36
Under this roadmap all MEPCO consumer metering shall be through smart metering by end of
2027. It is also recommended that in initial deployment of Smart meters, consumers with less than
300units consumption may be segregated and smart metering can be delayed reducing the cost of
overall program.
PA2-A4 Deployment of ICT infrastructure and PA2-A6 SCADA:
One of the most critical actions which needs to be taken is the deployment of communication
technology for transfer and receipt of signals, data and information between MEPCO data center
and the field devices. MEPCO grid modernization efforts rely heavily on automation technologies
that require reliable two-way communication between equipment and control applications.
Without effective communication infrastructure, MEPCO may not be able to automate processes
such as meter reading, fault detection, and service restoration, leading to increased costs and
reduced efficiency. Without reliable communication infrastructure, MEPCO may not have real-
time visibility into its distribution network conditions, leading to slower response times and
increased downtime.
Additionally, Communication infrastructure plays a crucial role in the operation and effectiveness
of SCADA (Supervisory Control and Data Acquisition) systems. MEPCO requires to implement

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communication technology within the distribution substation fence for substation automation as
well as beyond the fence into the feeder network for feeder automation. The communication
network in the field shall also be able to collect measured values from smart meters and
communicate it to data center (in this case the MDMS).
MEPCO 132kV /11kV substations consist of conventional control and relay panels. These
substations do not have remote terminal units (RTUs) or substation automation devices based on
IEC 61850 or otherwise, installed for data acquisition. The protection relays do support IEC 61850
standard however, vendor approvals are necessary for activation and availing this facility in most
cases. Considering this, following steps are required to be taken within the power substation fence
for substation automation and SCADA:
• All substations of MEPCO shall be equipped with RTUs for acquiring data and providing
to SCADA system. The RTU shall support all necessary interfaces and protocols in order
to acquire data from different equipment within the substations.
• The RTUs shall be compatible to communicate to various devices on IEC 61850, Harris,
DNP 3.0, IEC 870-5 101/104 and Modbus
• Signaling list for each substation shall be prepared mentioning control and data signals.
• Establishment of process bus. This will ensure that the instrumentation devices like CTs
VTs connect to a merging unit or RTUs which connects to the process bus. The protocol
followed shall be IEC 61850.
• Subsequently, the data from field is connected to the protection IEDs, Bay control units
(BCUs) and the station bus is established.
• The station bus provides communication between station level devices and bay level
devices and the process bus provides communication between bay level devices and
primary equipment. The process bus and station bus enable communication between the
installed equipment with substation.

Figure 7.3: SCADA hierarchy

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The communication technology required for transfer of the data from substation to the distribution
control center is of several types and depends on many factors. This is an essential part of the
SCADA system. However, before defining the communication system for SCADA, it is important
to consider the communication strategy for MEPCO as a whole instead of separately for each
application like SCADA, AMI etc.
It is also pertinent to mention that the development of communication strategy /framework for
MEPCO shall be the responsibility of the ICT department. The following steps shall be adopted
by MEPCO:
• Gap Analysis shall be carried out and communication technology assessment for MEPCO
network to ensure which technology is suitable. The assessment shall be done using a
holistic approach considering the use of applications such as AMI, SCADA, FLISR, DTMS
etc.
• An application-centric approach to developing a communication network of MEPCO shall
be adopted that shall support traditional applications as well as future modernized
application expected to be adopted globally.

Figure 7.4: Data Sources in a Distribution Network

Currently following on-site communication is specified in the AMI Project documents of

MEPCO:
Topology On-Site Level
• For Customers (1Ph & 3ph) Meters, and Meters for Substations’ Feeders, Large Customers
and Transformers where no Fiber Optic/ADSL facilities are present (or advisable):
• 3G/4G Modems
• Data Concentrator Units (DCUs) (eventually Gateways if no local data storage is
required)
• Meters, In-Home Display (IHD) when applicable
• For Substations’ Feeders, Large Customers and Transformers where Fiber Optic/ADSL
facilities are present (and advisable):

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• Routers
• 3G/4G backup modem (in critical points)
• Local router concentrator where more than one connection is present (meters,
modems, etc.)
• Meters
• Ethernet local LAN for meters’ data hopping.
MEPCO must be open to participate in the communication technologies evaluation processes to
examine the site conditions, and conduct pilot to analyse different alternative communication
technologies suitable for its critical applications. Any single technology may not cover the
complete network sensing. Therefore, the solution might then be even a hybrid communication
network with a mix of;
• PLC
• RF Mesh
• NB-IoT
Proposed MEPCO Communication Network Architecture:
It is recommended / proposed that a core network also known as Wide Area Network (WAN) shall
be deployed near the MEPCO headquarters and its distribution control center. The WAN can be
established using OPGW deployed on 132kV transmission lines at a portion of the operations circle
of Islamabad (which covers the MEPCO headquarter and DCC). The size may vary depending
upon the assessment carried out earlier.
The remote communication end points connect to the WAN, using wireless or wireline access
networks. These networks are called Field Area Networks (FAN). Remote communication end
points are spread across the utility at substations, feeders, consumer premises etc. For example, at
substation SCADA IEDs, at feeder DTMS IED, and for AMI technology DCUs may be deployed
in a distribution substation. In future, IEDS at EV charging infrastructure, or microgrids,
distributed generators are also remote end points. All these communication endpoints shall be
aggregated to be connected to WAN through FAN.

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Figure 7.5: Proposed Communication Framework for MEPCO

Wired and wireless communications both play an important role in the blend of communications
technologies necessary to enable future smart grid communications. Hybrid networks exploit
independent mediums to extend network coverage and improve performance.

Figure 7.6: Schematic Diagram of Distributed Generation resources connection to WAN through FAN

Some typical WAN & FAN Technologies are mentioned below which can be adopted by MEPCO:

Wide area networks (WANs) for distribution power companies typically fall into several
categories:

• Multiprotocol Label Switching (MPLS) Networks:

These networks use a set of protocols to prioritize traffic and efficiently route data packets
over the network. MPLS networks are commonly used by utility companies to support
mission-critical applications such as SCADA systems and distribution automation.

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• Digital Subscriber Line (DSL) Networks:

DSL networks use existing telephone lines to provide high-speed internet connectivity over
long distances. These networks are often used by utility companies to connect remote sites
to their corporate network.
• Satellite Networks:
Satellite networks use orbiting satellites to provide wide-area coverage and connectivity.
These networks are often used by utility companies to provide connectivity to remote areas
where other types of connectivity may not be available.
• Fiber Optic Networks:
Fiber optic networks use glass or plastic fibers to transmit data over long distances. These
networks offer high-speed connectivity and are often used by utility companies to connect
their substations and other facilities.
• Cellular Networks:
Cellular networks use radio waves to provide wireless connectivity over large areas. These
networks are often used by utility companies to provide connectivity to mobile workers
and field devices such as smart meters.
Field area networks (FANs) for distribution power companies typically fall into two categories:
• Wired FANs:
These FANs use physical cables, such as copper or fiber optic cables, to transmit data
between different devices and equipment. Examples of wired FANs include Ethernet-based
networks and power line communication (PLC) systems.
• Wireless FANs:
These FANs use wireless communication technologies, such as radio frequency (RF) or
cellular networks, to transmit data between different devices and equipment. Examples of
wireless FANs include Wi-Fi-based networks, cellular-based networks, and mesh
networks.
It must be mentioned that each technology has its own pros and cons, and a careful assessment is
required in order to develop an ICT infrastructure for modernizing MEPCO grid. The timeframe
for development of ICT infrastructure is kept till the end of phase 2. However, it must be mentioned
that development of communication network is an evolutionary process and may continue even
beyond the allocated development timeframe.
The SCADA development is kept as Circle wise. The following are details of MEPCO circle
wise grid stations:
Table 7.14: Details of Substations of MEPCO - Circle wise Grid and SCADA implementation duration
Circle No. of Grid Station Implementation Months
Multan To be provided by MEPCO 2024-2026 36
Dera Ghazi Khan To be provided by MEPCO 2024-2026 36
Vehari To be provided by MEPCO 2024-2026 24
Bahawalpur To be provided by MEPCO 2024-2026 36
Sahiwal To be provided by MEPCO 2024-2026 36
Rahimyar Khan To be provided by MEPCO 2024-2026 36
Muzaffargarh To be provided by MEPCO 2024-2026 36

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Bahawalnagar To be provided by MEPCO 2024-2026 36

Khanewal To be provided by MEPCO 2024-2026 36

The MEPCO with help of GIZ’z Renewable Energy and Energy Efficiency-II program has
developed capacity of its officials in terms of SCADA installation and commissioning. This shall
enable the team of MEPCO to oversee the activities related to SCADA implementation across its
distribution network. It is understood that the SCADA team of MEPCO is capable enough to lead
the future planning of full scale roll out of SCADA program for MEPCO substations. Therefore,
it is recommended that the team should be involved in the preparation of proposals consisting of
signal lists and BoQ. MEPCO can engage supervision consultants to ensure the quality of the
procured and installed system. Initially due to lack of communication infrastructure and storage
capacity, cloud storage and GSM network shall be utilized.
The overall timeframe for completing the SCADA project shall be within phase 1 which is the end
of 2026.
PA 5-A2 Establishment of Renewable Energy Department:
Under the Solar Initiative 2022 by Government of Pakistan, 2000 11kV feeders are to be solarized.
Considering the lack of know-how in MEPCO for the advanced RE technologies and the
operational difficulties associated with them, it is important to establish a dedicated working group
specifically with expertise of renewable energy technologies. The Renewable Energy department
is recommended to be established at the start of 2024. The formal procedures and approvals shall
be initiated immediately. Resources suitable for working in RE department can be grouped into a
team for time till the establishment of RE department. This team can guide MEPCO on Solar
initiatives 2022. Moreover, the provisioning of distributed generation net metering licensing shall
also be under this department. The technical assessment of installed distributed generators within
MEPCO territory shall be under the scope of RE department. The planning and analysis tools for
RE technologies as well as Distributed Energy Resource Management (DERMS) system shall be
operated by RE department of MEPCO.
Once the RE department is established, Capacity building of its officials shall take place to enhance
their expertise the procurement, technical assessment, integration, financial analysis and project
management of RE projects in the distribution network of MEPCO.
Time to establish RE department is 8 months.
PA3-A1 Deployment / Enhancement of MDMS
The scope of AMI and MDMS deployment are linked to each other. As mentioned in chapter 6
that MDMS acts as the brain house of AMI system. MEPCO has a total consumers quantity of
approximately 7.9million. Therefore, MDMS shall be deployed accordingly, and future extension
capacity shall also be kept in view.
Therefore, the scalability of MDMS is linked to the further deployment of smart meters and the
time frame shall accordingly be linked to it.
PA4-A4 Establishment of Microgrids within Service Territory
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Several un electrified villages exist within service territory of MEPCO. Extending the feeder
network to these areas may not be a cost-effective way to energise these rural villages.
Alternatively, MEPCO shall look towards forming microgrids for these unserved regions. By
developing the microgrids, MEPCO shall bill the dwellers on a monthly basis which shall be a
source of revenue. Subsequently, MEPCO may at a later stage extend its 11kV feeder as a separate
source to this microgrid.
Establishing of microgrid(s) in unelectrified area(s) within a MEPCO's service domain will
provide several benefits, including improved customer engagement and satisfaction, increased
revenue, reduced reliance on the grid, improved energy efficiency, environmental sustainability,
and community development.
The time frame to electrify the unelectrified areas through the forming of Micro grids is kept at 3
years starting from 2024 to 2026.
PA2-A2 Fault Location & Isolation & Service Restoration (Software)
After the installation of network field sensors, switches and sectionalizers in MEPCO’s feeder
network and the deployment of adequate communication infrastructure, the software for FLISR
shall be utilized to detect, locate, isolate, and restore faults in the distribution system.
The software uses advanced analytics and algorithms to process data from various sensors,
communication networks, and other sources to quickly detect and locate faults in the distribution
system. The software then automatically isolates the faulted section of the system and restores
service to unaffected areas. It is also worth mentioning that FLISR is often part of the Distribution
Management System (DMS) suite of applications.
MEPCO can ensure feeder automation through FLISR. The implementation of FLISR shall take
place feeder wise, depending upon the setting up of cloud for storage and communication
infrastructure for transmittal of the data from field. Therefore, the FLISR can take place gradually
as the communication infrastructure is established.
The pilot project for FLISR shall be initiated within the year 2024. Subsequently, Full scale roll
out shall take place. It shall be ensured that atleast 75% of the feeder network shall be capable of
automated FLISR by end of phase 1 ie., 2026. Remaining feeders can be extended into phase two.
PA4-A2 Distributed Energy Resource Management System (DERMS) &
PA4-A3 RE Planning, Analysis & Forecasting Tool
The DERMS shall be utilized after the establishment of RE Department within MEPCO. This
software shall have all the capabilities of planning and analysis and forecasting of the distributed
RE generation in MEPCO’s distribution system.
By end of 2026 (Phase 1), it is expected that 5% of Demand of MEPCO shall be from installed RE
capacity directly connected to MEPCO’s network in form of net metered generation or feeder
solarization. Similarly, by the end of phase 2 and 3 this will go up to 10% and 15% respectively.

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To effectively manage this distributed generation, DERMS will help distribution system planners
and operators to gain better insights.
The utilization of DERMS shall start after the formation of RE department who will be using this
tool. All Net Metered distributed generation real time data shall also be integrated into the system
for visibility of the net energy consumption of MEPCO.
The DERM can be utilized by the end of 2024 after the establishment of RE department.
PA5-A3 Social Media Management Department
With systems like FLISR, SCADA, DERMS, AMI in place(partially), the Social Media Marketing
Department shall become effective in transmission of useful information of status of the network
as well as outages and restoration to the customers.
The use of social media as a tool to gain customer confidence does not need to wait till full time
utilization of the above-mentioned applications. Instead, an SMM department can even be formed
immediately, though the scope would be limited to the transfer of general information and
decisions taken by management to the consumers to keep them engaged positively.

7.9.3 Implementation Strategy Priority Level 10-15:

PA2-A8 Deployment of DMS / EMS
The use of Distribution Management System is a unified approach to the overall control and
monitoring of the Distribution network. Small applications for enhanced visibility and control of
the distribution network make up the distribution management system. Therefore, once a certain
level of grid automation is reached, the use of DMS is inevitable.
By this time, it is foreseen that MEPCO’s network shall have partial substation automation as well
as feeder automation. Furthermore, there is an enhanced penetration of RE into MEPCO’s network.
Therefore, a unified approach to distribution system planning and management will be required.

Figure 7.7: Distribution Management System (DMS)

Therefore, a Distributed management system shall enable the planners and operators to assess the
operating conditions of MEPCO’s network and deliver more efficient results in lesser time. All

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applications such as FLISR, Load Flow Analysis, SCADA, VVO, GIS are integrated in DMS for
a unified view.
Thus, Procuring DMS application or module-wise can be a more cost-effective approach, as
MEPCO can start with the most critical functionality and expand as needed. However, it's
important to consider the interoperability of the different modules and ensure that they can work
together seamlessly. Plans for integration and data migration when adding new modules to DMS
shall also be paid special attention.
PA7-A2 Privatization / Provincialization
Private companies are more efficient than government-controlled entities due to their profit motive
and increased flexibility in decision-making. This results in improved service delivery and reduced
costs for consumers. Private companies have access to more capital, which allows for more
investment in modernizing the electric grid and expanding access to electricity. As it has already
been mentioned in previous section how MEPCO requires expansion of its distribution network to
cater more power demand by 2030, this expansion requires continuous financial investment
throughout the roadmap period. MEPCO (in addition to other distribution companies of Pakistan)
is centrally controlled by Government of Pakistan through Ministry of Energy. The management
structure of MEPCO (and the other distribution companies) is based on corporate governance
principle. However, the same is not practiced in a true sense. It is an open secret that decisions
about finance, employment and pricing are not without government (political) intervention. It can
be ascertained that a better decision making can certainly transform it into a modernized and
efficient organization. Therefore, privatization is proposed: Following steps are some major
required to be undertaken for privatization of MEPCO:
• Developing a Legal Framework:
The government of Pakistan (GoP) through Ministry of Energy (MoE) will need to
establish the legal framework that enables the privatization of MEPCO. This may involve
passing new laws or amending existing ones to provide for the sale of the company and the
transfer of its assets and liabilities to a private owner.
• Valuation and Sale:
The GoP will need to value the electric distribution company and determine the terms of
the sale. This may involve hiring an investment bank or financial advisor to conduct a
valuation analysis and solicit bids from potential buyers.

• Regulatory Approval:
Due to regulatory framework in place, the privatization shall require approval from
regulatory body (NEPRA) responsible for overseeing the electric distribution sector of
Pakistan. NEPRA may need to evaluate the impact of privatization on customers (in terms
of Tariff), the electric grid, and competition.

• Transfer of Assets and Liabilities:

After finalization of the Buyer, the Government will need to transfer the assets and
liabilities of MEPCO to the new owner. This will involve negotiating and executing sale

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agreements and transferring ownership of physical assets such as transmission lines,

substations, and other infrastructure.

• Transition and Implementation:

The Government and new owner will need to work together to ensure a smooth transition
and implementation of the privatization. This will involve addressing any legal, financial,
or operational challenges that arise during the transition.

The time frame kept for Privatization of MEPCO is 1.5 years starting from 2024.
PA7-A1 Innovative Business Model
Innovative business models can offer a range of benefits for organizations like MEPCO, including
competitive advantage, increased efficiency, better customer experiences, new revenue streams,
and adaptability. As a result, they are worth considering for organizations which are looking to
enhance their profitability and succeed in today's dynamic business environment.
Some business models were introduced in section 6 which are reproduced here:
• Revenue generation through data monetization
• Revenue Generation through Consumer Subscription
• Revenue Generation through EV charging
• Revenue Generation through Energy Efficiency Services
• Revenue Generation through Microgrid
These business models shall be adopted to increase profitability of MEPCO and create extra
revenue streams for increasing financial health and sustainability. The time to implement these
business models may vary depending upon the readiness of the availability of the functionalities
to be sold to the consumers. However, groundwork must start in phase 1 while full scale benefit
from these business models may be attained at start of phase 2.
PA4-A1 Hosting Capacity Analysis (HCA)
HCA requires to analyse the distributed generation which can be integrated into a distribution
network (feeder). This will need to be carried out by the RE department of MEPCO. However, the
time to carry out such analysis can be delayed till the penetration of a certain amount of RE in the
network.
Hosting capacity analysis (HCA) can be conducted at different stages of the development and
operation of a distribution system. Ideally, the HCA should be conducted as early as possible in
the planning process, as this can help to identify constraints and opportunities for DER integration
before major investments are made in the distribution system.
However, it can also be carried out after a considerable amount of RE injected in the network.
HCA can also be conducted on an ongoing basis to monitor the impact of existing DERs and to
identify any potential issues that may arise due to changes in customer behavior or grid conditions.

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It is recommended that MEPCO RE department should develop technical capacity to carryout this
analysis at a regular basis on their own. Initially, HCA can be done through external consultants
which can train the RE department officials. Subsequently, HCA shall be performed on MEPCO
network regularly.

7.9.4 Implementation Strategy Priority Level 15 and onwards:

PA8-A1 Actions supporting EV Readiness
MEPCO network being ready for EV’s is an evolutionary process. Some of the important measures
which need to be undertaken have already been mentioned in earlier priority levels. However,
some measures exist which are exclusive for preparing the distribution grid as well as the
organization for mass level induction of electric vehicles in the system.
Keeping the NEV policy in view, certain measures are required to be taken. For this purpose,
MEPCO would need to play an important role alongwith other stakeholders. Some important steps
are listed below:
• Conducting Load Analysis prior to deployment of EV chargers
• Development of SOPs/ Specifications for deployment of EV chargers
• Enhancement of upgrading of electrical infrastructure ie., addition of distribution
transformers, increase in capacity of power transformers or building of additional
substations.
• Ensure the communication infrastructure exists in the vicinity of installation of EV
chargers.
• Announcing Tariffs for G2V and V2G.
• Implementation of Demand Response programs through smart charging
• Safety regulations shall be made for safe operations of the EV chargers.
• Monitoring platform shall be made for monitoring of EV chargers
The above steps shall be gradually started. It is recommended that the RE department should also
focus on the development of framework, regulations, SOPs and specifications etc. necessary for
the promotion of EV and EV charging infrastructure. Initially MEPCO shall identify areas within
its service territory at shopping malls, public parks, grocery markets where consumers normally
park their vehicles for 15 to 30 mins.
The time frame shall begin from the establishment of RE department and shall go deep into phase
2.
PA7-A5 Tariff Restructuring
Tariff restructuring of Pakistan's distribution companies (DISCOs) has been an ongoing process
aimed at improving the financial sustainability of the power sector in the country. Provision of
different tariffs for each distribution company based on its unique circumstances was conceived in
the NEPRA Act 1997. The approach of uniform tariff is against the spirit of the reforms plan
introduced in the early 1990s and the Public Sector Corporate Companies Act. Initially, the burden
to make the differential tariff uniform for all consumers in Pakistan was on the Federal

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Government. However, afterwards, the government introduced the mechanism of cross-

subsidization across Discos. Due to this, consumer tariff of good performing DISCOs (of which
one is MEPCO) increases due to subsidizing poor performing DISCOs in order to keep the tariff
uniform throughout Pakistan.
Therefore, tariff structuring is essential for encouraging good performing DISCOs like MEPCO to
gain profitability and re-invest in modernizing their distribution system. Tariff restructuring shall
start immediately. The time duration for this is kept as18 months.
PA2-A7 Deployment of Enterprise GIS
Although GIS is an important part of the DMS. However, its importance in priority level is low
due to the fact that it doesn’t create a direct impact but rather acts in facilitation of other application
like OMS, SCADA, work force management etc. Furthermore, MEPCO has already carried out its
MV(11kV) network GIS mapping. Scope of GlS mapped Distribution Network of MEPCO was
primarily designed to carry out load flow analysis of MEPCO Distribution System (11kV only).
Therefore. only selected attributes of Distribution Network required for modeling in SynerGEE
Electric software are collected from the field by GlS Surveyors. However, for carryout LT mapping
migration from GIS desktop to enterprise is required.
In order to integrate GlS with DMS, it is essential to establish a GIS enterprise system which may
be hosted at MEPCO Data Center located at MEPCO H/Q in order to update 11kV network of
MEPCO more efficiently and mapping of LT network upto consumer level can be achieved by
having database at backend.
Therefore, the existing GlS setup presently deployed in MEPCO shall be upgraded to include LT
level as well i.e migration from Desktop based system to enterprise level along with capacity
building of MEPCO Staff.
PA3-A5 Customer Information System
The Customer Information system is part of the ongoing AMI project at MEPCO. As per the
specification for CIS under the AMI project, the future Customer Information System (CIS) at
MEPCO should be the place where all data of the customer and the relations between customer
and utility is stored and can be presented to the various departments of utility. MEPCO CIS should
get and send data to and from
• The Billing System
• The Meter Data Management System,
• Deployment system
• Call Centre
This CIS should be integrated with existing and future business suite applications i.e ERP (SAP)
and GIS Enterprise Application (ArcGIS & Synergy) etc. This advanced CIS system shall be able
to communicate bills and associated information to consumers through email integration refers to
the ability of the CIS to seamlessly merge with utilities current or future email application. The
email integration feature allows the utility to send emails and track client activities without

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toggling between various applications. In future, the utility shall communicate with the customer
via SMS, Social Networks or even with In-House Display. The CIS must be able to interface to all
existing applications mentioned earlier.
The CIS shall be capable of managing data for all existing and future consumers of MEPCO. The
time frame for this shall be as per the existing AMI contract with a further period for future AMI
extension for remaining consumers.
PA7-A3 Addressing Role of Unions
As mentioned din chapter 6 , addressing role of Labour union is extremely necessary to overcome
any hurdle in successful privatization / provincialization of MEPCO. Some of the important
aspects to consider are following:
• Inclusion of Union in Privatization Process:
One common strategy is to negotiate early and often with the government or private sector
entity that is planning to privatize a public service. This allows unions to have a say in the
terms of privatization, such as the level of job security that will be offered to employees, the
terms of severance pay, and the impact on working conditions. In some cases, unions have
also been successful in negotiating agreements that guarantee that privatized services will
continue to be provided at a high quality and at an affordable price.
• Safeguard Workers' Rights:
Pay attention to workers' rights and ensure they are protected during the privatization process.
Maintain job security provisions, honor existing employment contracts, and avoid any unfair
treatment or discrimination against employees due to the privatization. Consider mechanisms
to address grievances and disputes, ensuring access to fair and impartial resolution processes.
• Retraining and Skill Development:
Privatization often brings changes in technology, processes, and job requirements. Recognize
the need for retraining and skill development programs to help workers adapt to the new
environment. Collaborate with labor unions to design and implement comprehensive training
initiatives that enhance workers' skills and enable them to thrive in the privatized setting.

Encourage social dialogue and collaboration between management, labor unions, and relevant
stakeholders even after the privatization / provincialization process is complete. This ongoing
engagement can help address emerging issues, foster a positive labor-management relationship,
and ensure the continued protection of workers' rights.
Negotiation Cell at Ministry of Energy (Power Division)
It is proposed that a negotiation cell consisting of representatives from Ministry of Energy as well
as privatization authority, utility management, legal experts, human resources, and other relevant
stakeholders shall be formed at MoE. The cell shall be responsible for strategizing in addressing
the role of unions in order to hear their concerns and mitigate any urgent measure. Policy paper
shall be extracted from such negotiations which will enable the stakeholders in smooth transition
of MEPCO from public to private sector entity.

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Figure 7.8: News on Protest of Labour Union

PA3-A4 Consumer Engagement Programs

MEPCO shall launch a customer engagement program subsequent to the establishment of its social
media department as well as the Customer Information System. The consumer engagement
programs are specified in section 6.
Consumer engagement programs can be particularly effective when implemented during periods
of change or growth. For example, if the company is expanding its service territory or introducing
new technologies, engaging with customers can help ensure a smooth transition and minimize any
disruptions. Similarly, if the company is facing challenges such as high energy demand or aging
infrastructure, engaging with customers can help identify potential solutions and mitigate risks.
Another key factor to consider when starting consumer engagement programs is the company's
overall strategic goals. If the company is focused on increasing energy efficiency or reducing costs,
for example, consumer engagement programs can help achieve those goals by encouraging
customers to be more mindful of their energy usage and offering incentives for reducing
consumption. On the other hand, if the company is focused on expanding its customer base or
generating new revenue streams, consumer engagement programs can help attract new customers
and offer new services to existing ones.
As MEPCO is implementing its grid modernization roadmap, it should start its consumer
engagement program as soon as possible. However, it is preferable to initiate consumer programs
after formation of social media management department.
One important step for MEPCO would be to develop a comprehensive communication strategy
that outlines the goals and objectives of the consumer engagement program. This strategy should
include outreach efforts to educate customers about the benefits of grid modernization and how it
can help them save energy and money. The strategy should also include targeted messaging that is
tailored to different customer segments, such as residential, commercial, and industrial customers.

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 7.10 DEPICTION OF ROADMAP

Phase 1 Phase 2 Phase 3

RE share 5% RE share 10% RE share 15%
Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10

Program Area
Projects(Actions) 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033
(PA)
Grid Enhancement

A1: Constructing New Substation

PA1:

A2: Extensions / Remodelling /

Augmentation

A3: Constructing New Distribution

Feeders

A1: Volt Var Optimization

A2: Fault Location Isolation & Service

Restoration
Grid Efficiency, Reliability & Resiliency

A3: Hardware Upgrades Sectionalizers,

Reclosers, Sensors, Automatic Switches

A4: Deployment of Communication

Infrastructure
PA2:

A5: Deployment of Sensors / Field

Devices

A6: Deployment of SCADA

A7: Deployment of Enterprise GIS

A8: Deployment of DMS / EMS /EAMS

A9: Deployment of DTMS

A1: Deployment of MDMS

Enhanced Consumer

A2: Deployment of Smart Meters

Consumers
Experience
PA3:

A3: Deployment of Smart Meters

Distribution Transformers

A4: Consumer Enagegement Programs

A5: Customer Information System

Program Areas

PA4: Decarbonization

A1: Hosting Capacity Analysis

through RE

A2: Distributed Energy Resource

Management System
A3: RE Planning, Forecasting & Analysis
Tool
A4: Establishment of Microgrids within
Service Territory

A1: Establishment of ICT Department

PA5: Organizational
Re structuring

A2: Establishment of RE Department

A3: Social Media Management

Department

A4: Dedicated Cloud

A5: Business Suites

A1: Capacity Building ICT

A2: Capacity Building RE

A3: Capacity Building Business Suites
ERP
Capacity Building

A4: Capacity Building CX / SMM

PA6:

A5: Capacity Building Cyber Security

A6: Capacity Building Safety &

Operations

A7: Capacity Building Leadership

A8: Capacity Building Energy Market /

MIRAD

A9: Capacity Building AMI

A1: Innovative Busines Model

Policy Support
Regulatory &

A2: Privatization / Provincialization

PA7:

A3: Addressing of Role of Unions

A4: MIRAD /CTBCM

A5: Tariff Restructuring

Readiness of
PA8:

Grid
EV

A1: Actions supporting EV Readiness

Figure 7.9 Roadmap of MEPCO

Note: Green Bar Represents Timeline to implement the actions while the shaded bar represents continutity in support of
actions once they are implemented

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8. Performance & Reliability Metrics of Roadmap

The purpose of this section is to define the strategic roadmap performance & reliability metrics.
The performance metrics are defined for gauging the progress of physical implementation.
Performance metrics provide a framework for measuring the effectiveness and efficiency of a
distribution company's technology roadmap and can help inform data-driven decision making to
drive growth and optimize business outcomes. A well-defined performance metrics framework can
help ensure that everyone in the organization has a shared understanding of the goals and
objectives of the technology roadmap. This can improve communication and collaboration
between teams and stakeholders. By regularly monitoring and analyzing performance metrics,
distribution companies can identify opportunities for continuous improvement and make
adjustments to their strategic roadmap as needed. This can help ensure that the company stays agile
and responsive to changing market conditions. This can help the company stay competitive and
identify opportunities to differentiate itself in the market.
Alternatively, reliability metrics will gauge MEPCOs network in terms of its reliability in
supplying continuous supply of electricity without outages. It provides targets to minimize
outages. The targets are provided in terms of SAIFI and SAIDI explained later in this chapter.
Moreover, it also sets targets for improvement in T&D losses of the network by utilizing the
recommended action for MEPCO, it is forecasted that MEPCO shall reduce its technical and
commercial losses considerably.

Metrics for Gauging

Roadmap Progress

Performance Metrics Reliability Metrics

Figure 8.0: Metrics for gauging progress on roadmap

8.0 Performance Metrics:

The performance metrics under this roadmap shall consist of four parts. These performance metrics
will prove to be key for MEPCO to track and measure growth and development of MEPCO in a
modernized way.

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8.1 Distribution Automation (DA) Metrics:

The metric is used to measure the progress of the automation and digitalization of the distribution
infrastructure of MEPCO. Starting from MEPCO grid stations to feeders, this will monitor the
progress of deployment of field devices and necessary equipment upgrades to ensure that sensing
capabilities are established throughout power distribution network. The following actions are
covered under Distribution Automation Metrics: PA2-A3, PA2-A1, PA2-A5, PA5-A1
PA5-A4PA2-A6, PA2-A9, PA2-A2, PA2-A7
Subsequently, these metrics are divided into two parts.
1. Substation Automation
The completion of this task can be divided Operation Circle wise and then further into the
voltage levels. All substation automation tasks/actions shall be achieved prior to attaining
a completion status. Bi annual reporting on physical progress shall be submitted to MEPCO
authorities and Ministry of Energy.

Table 8.1: Substation Automation completion in Percentage

Circle Percentage HV Level Percentage MV
Automated Level Automated
(132kV) (11kV)
Multan 25 25
25 25
25 25
25 25
Dera Ghazi Khan 25 25
25 25
25 25
25 25
Vehari 25 25
25 25
25 25
25 25
Bahawalpur 25 25
25 25
25 25
25 25
Sahiwal 25 25
25 25
25 25
25 25
Rahim Yar Khan 25 25
25 25
25 25
25 25
Muzaffargarh 25 25

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25 25
25 25
25 25
Bahawalnagar 25 25
25 25
25 25
25 25
Khanewal 25 25
25 25
25 25
25 25

2. Feeder Automation
The completion of this task can be divided into Operation Circle wise. All feeder
automation tasks/actions shall be achieved prior to attaining the completion status. Bi
annual reporting on physical progress shall be submitted to MEPCO authorities and
Ministry of Energy.
Table 8.2: Feeder Automation completion in Percentage
Circle Percentage Feeders Automated
Multan 25
25
25
25
Dera Ghazi Khan 25
25
25
25
Vehari 25
25
25
25
Bahawalpur 25
25
25
25
Sahiwal 25
25
25
25
Rahim Yar Khan 25
25
25
25
Muzaffargarh 25

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25
25
25
Bahawalnagar 25
25
25
25
Khanewal 25
25
25
25
Multan 25
25
25
25

3. Communication Infrastructure (PA2-A4)

Measuring the progress on deployment of communication infrastructure in a
geographically spread distribution power network is not a straightforward task. Various
parameters are required to verify and analyse to ensure the reliability and functionality of
the communication network. However, for the sake of simplicity, it is proposed to use the
coverage and connectivity methodology. Measuring the coverage area and the number of
customers who have access to the communication infrastructure can provide insight into
how well the deployment project is progressing. Furthermore, this may involve the
monitoring of the installation of equipment such as towers, routers, antennas and monitor
the connectivity and signal strength through metrics such as signal-to-noise ratio (SNR),
packet loss and latency.

MEPCO, being divided into circles and divisions for management, shall utilize these
service areas to monitor the progress of deployment of communication infrastructure.
Quarterly assessments can show how the coverage and connectivity have improved over
time in these operational circles and whether any adjustments need to be made.

4. SCADA (PA2-A6)
Some of the measurands that can be used to measure the progress of implementation of
SCADA program are mentioned below:
• Procurement of SCADA Software
• The percentage of equipment at each substation that is connected to the Remote
Terminal Unit / Bay Control Unit
• The number of substations that have been connected with SCADA system through the
BCU/RTU
• Alarms and alerts that are being successfully transmitted to the control center

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• Commands for Control of Substation breakers can be sent through SCADA at control
center

These are a few parameters which can be gauged regularly to monitor the progress of SCADA
program.

8.2 Customer Engagement Metrics (PA3-A4, PA3-A5):

For a regulated power distribution company like MEPCO, customer engagement is important. In
a regulated monopolized market, the government (through regulator) typically sets the prices that
the distribution company can charge its customers, so the utility may have less control over its
revenue streams. However, customer engagement remains important for several reasons.

For MEPCO, customer engagement can help it to improve its reputation and increase customer
satisfaction. By engaging with customers and addressing their needs and concerns, MEPCO can
build trust and foster a positive relationship with its customers. This will lead to increased customer
loyalty and advocacy, which can be particularly valuable in a move towards a competitive market.

Moreover, customer engagement can help MEPCO to better understand its customers' needs and
preferences, enabling it to develop and offer new products and services that meet those needs. This
can lead to increased revenue opportunities (as already discussed in previous chapters) and a more
diversified business model.

Additionally, customer engagement can help MEPCO to promote energy efficiency and
conservation and distributed generation installation. By encouraging customers to adopt more
energy-efficient practices and distributed generation technologies, MEPCO can reduce demand
and avoid the need for costly infrastructure investments. This will help to keep energy costs low
for customers and reduce the environmental impact of energy generation.

In order to gauge all these actions, following metrics are developed for MEPCO to keep check on
its own performance:

Social Media Engagement:

MEPCO, after establishing its Social Media department /team and developing its social media
network, should keep count of social media interactions with consumers on a regular periodic
basis. Following can be a certain targeted guideline:
Table 8.3: Targeted Periodic Social Media Interaction

Social Media Interactions No. of Interactions

Daily 100
Weekly 1,000
Monthly 4,000
Yearly 52,000

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The social media interaction can include metrics such as no. of likes, comments, shares, followers
etc. on MEPCOs social media platforms like Facebook, Instagram, YouTube etc.

Customer Engagement Programs:

MEPCO should launch customer engagement programs to bring innovative ideas on how to
develop customer trust. Such Engagement programs are mentioned in the previous chapter.
Therefore, Metric for gauging customer engagement can be no. of customer engagement programs
launched by MEPCO and measuring success ratio of each of the program. Each Customer
engagement program contributes towards 25% of achievement of this metric.

Table 8.4: Customer Engagement Program Targeted Completion

Customer Engagement Percentage Completion

Programs Achieved
Program 1 25
Program 2 25
Program 3 25
Program 4 25

It is worth mentioning that the nature of the program along with time period for implementation is
is kept open in this road map to allow flexibility to MEPCO for selection of appropriate program.
However, minimum no. of programs is kept at 4. MEPCO management may increase this number
depending upon the customer feedback.
Enhanced Customer Experience:
Enhanced customer experience will ensure that customers are provided with basic facilities at its
doorsteps. These facilities include:
1. SMS or Email Services for monthly bill
2. Convenient Bill Payment Solutions (Online, Doorstep Collection etc.)
3. Online Consumer Account (Details of Energy Consumption)
4. Customer Alert Services due to outage or maintenance
5. 24/7 helpline / Call Center
6. Complaint Management System
7. Energy Audit Services
8. Renewable Energy Distributed Generation System Services
These are a few services which MEPCO can provide to its consumers which contribute towards
enhanced customer experience. In order to measure the customer experience performance metric,
a detailed mechanism is to be developed which is out of scope of this roadmap. However, as a

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basic step, MEPCO can consider implementing a minimum of any two facilities for customers
each year. This minimum criterion can be used to measure the implementation of steps towards
enhanced customer experience.

“Two facilities per annum for Enhancing Customer Experience”

8.3 Capacity Building Metrics (PA6-A1 to PA6-A9):

Capacity building is an important part of employee satisfaction and loyalty towards its
organization. The following Capacity building actions shall be covered under this: PA6-A1 to
PA6-A9.

The capacity building metrics is mentioned as follows:

Table 8.5: Capacity Building Training completion metrics

Sr. Capacity Building Trainings Metrics

No.
1. Renewable Energy training program All officials of RE department shall be
trained as per trainings mentioned in
section 6
2. ICT training program All officials of ICT department shall be
trained as per trainings mentioned in
section 6
3. Utility Business Suite training program ICT and IT/ERP department officials shall
be trained
4. Customer Engagement and Social Media CIS, HR and SMM department officials
management for utilities training program shall undergo this training program
5. Grid Modernization training program Various rounds of trainings on grid
modernization shall be carried out for
operation, planning, testing, and other
departments.
6. Leadership Development for energy utilities All Officials starting from Director,
training program Managers, General Managers, and Chief
Executive officers along with BOD
members shall undergo a leadership
training program specifically devised for
energy utilities.
7. Distribution System Operation training program All operations and planning department
shall undergo this training program

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8. Cyber Security training program ICT and IT department shall undergo this
training program.
9. Distribution system safety training program All field construction and operational
crews shall undergo this training
10. Human Resource Management training HR and SMM department shall undergo
program this training program
11. Energy Market Management Training ICT, IT, MIRAD, Planning and
Procurement department shall under go
this training program.

8.4 Advanced Metering Infrastructure Metrics:

The AMI can be divided into three parts. These three parts will cover the installation of smart
meters, the establishment of communication link between installed smart meter and the MDMS
and going live of the customer information system (CIS) whereby the customer can access its
information through customer portal and mobile application.
No. of Installed Smart Meters (PA3-A3, PA3-A2):
A completion rate method will be used to gauge the measurement of smart meters installed in
MEPCO network. This method measures the percentage of smart meters that have been installed
compared to the total number of meters that need to be installed. For example, if MEPCO needs
to install 100,000 smart meters and has installed 50,000, the completion rate would be 50%.
Under the AMI program mentioned in section 6, MEPCO requires installing smart meters on total
consumers as well as distribution transformers. The details are reproduced below.

Total No. of 7.9 million

Consumers
Total No. of 230,081
Distribution
Transformers

A total of 8.2 million-meter points needs to be covered under the AMI program. The percentage
of installed smart meters shall be updated periodically (quarterly or biannually) and a performance
report shall be presented to management to analyse.
Establishment of Communication Link with MDMS (PA3-A1):
After successful installation of Smart Meters, this parameter will provide insights as to how many
smart meters have established a two-way communication channel with the MDMS installed.
Access to Customer Portal & Mobile Application:

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After establishment of two-way communication channel between smart meters and data servers,
this metric will ensure that the customers with installed Smart meters at their premises are able to
view their data consumption history through customer portal and mobile application.

8.5 Reliability Metrics

The reliability of an electric distribution company’s services is influenced by its engineering
investments, both in the past and present. Using reliability metrics is crucial in ensuring that a
distribution company is fulfilling its role and providing reliable and consistent services. While the
primary use of reliability statistics is for self-evaluation, distribution utilities can also compare
their data with other similar utilities. However, there are limitations to utility-to-utility
comparisons due to differences in factors such as network configuration, weather conditions, and
the number of customers served.

8.5.1 SAIFI & SAIDI:

NEPRA, the regulatory authority for the power sector in Pakistan, considers providing a
dependable power supply to end consumers as crucial for economic growth. To evaluate the
reliability of the distribution system of DISCOs, NEPRA has developed two types of standards:
SAIFI and SAIDI. These standards help to measure the average number and duration of power
outages experienced by consumers. By monitoring compliance with these standards, NEPRA can
ensure that DISCOs are meeting their obligations to provide a reliable power supply to their
customers.

Figure 8.1: Types of outages

NEPRA has named them as overall performance standard 1 and 2 (OS1 & OS2).
8.5.1.1. System Average Interruption Frequency Index (OS1):
A distribution company shall ensure that the System Average Interruption Frequency Index
(SAIFI) of supply of power per consumer per annum does not exceed thirteen (13). Lower SAIFI
numbers represent less interruptions and better electric reliability.

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System Average Interruption Frequency Index* (SAIFI) =

Total annual number of all Consumer Power Supply Interruptions
Total number of consumers served by the distribution company in a given year
* In the calculation of SAIFI (OS1) any Power Supply Interruption on the distribution system of a distribution company
caused due to the outage of a transmission (220 kV and above) or generation facility OR another licensee's (other
than the distribution company) system facility (planned or unplanned interruption) shall not be accounted for.

MEPCO SAIFI DATA

600

400 471
369.16 375.98
200 316.22
43.94
0
SAIFI
2018 2019 2020 2021 2022

Figure 8.2: MEPCO SAIFI numbers

8.5.1.2. System Average Interruption Duration Index (OS2):

A distribution company shall ensure that the System Average Interruption Duration Index (SAIDI)
of supply of power per consumer per annum does not exceed fourteen. Lower SAIDI minutes
equate to better electric reliability.
System Average Interruption Duration Index* (SAIDI) =
Aggregate sum of all Consumer Power Supply Interruption durations in minutes
Total number of consumers served by the distribution company in a given year
* In the calculation of SAIDI, any Power Supply Interruption on the distribution system of a distribution company
caused due to the outage of a transmission (220 kV and above) or generation facility Or another licensee's (other than
the distribution company) system facility (planned or unplanned interruption) shall not be accounted for.

MEPCO SAIDI
2018 2019 2020 2021 2022
50000 39733
26822.35 31419.3 31,920.87
2794
0
SAIDI

Figure 8.3: MEPCO SAIDI numbers

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The data submitted by MEPCO in previous years was unrealistic and authority has highlighted
this in its Performance evaluation reports of DISCOs.
In view of above it is important that not only improvement in SAIFI and SAIDI index of MEPCO
is required, instead the methodology for gathering data and calculating the true SAIFI and SAIDI
indices also need to be taken care of for accurate performance reliability measurement of the
distribution grid of MEPCO. It is apprehended that MEPCO along with other DISCOs are unable
to consider which type of outages are to be taken for SAIFI SAIDI measurement and what are to
exclude. Different types of outages are mentioned in figure 8.1.

Improving SAIFI & SAIDI requires a multi-faceted approach that involves investing in
digitalization, automation, and infrastructure upgrades. By adopting smart grid technologies, a
distribution company can quickly detect and isolate faults in the system, leading to shorter and less
frequent outages. Additionally, investing in infrastructure upgrades and maintenance helps to
ensure that the system operates efficiently and reliably, leading to improved SAIFI and SAIDI
figures. Explanation is provided how advanced grid technologies recommended for MEPCO will
help in improvement of SAIDI and SAIFI.
8.5.2. Improvements in SAIFI & SAIDI through recommended actions:
• FLISR:
FLISR (Fault Location, Isolation and Service Restoration) technologies and systems involve
various automated devices and systems, such as feeder switches, reclosers, line monitors,
communication networks, DMS, OMS, SCADA systems, grid analytics, models, and data
processing tools. These technologies are designed to work together to automatically detect
and isolate faults in the distribution grid and restore power as quickly as possible, reducing
the impact and duration of power outages. By automating power restoration, FLISR
technologies can improve the reliability of power supply and reduce customer downtime.
FLISR technology automates power restoration during outages by isolating the affected area
and restoring service to the remaining customers by transferring them to adjacent circuits.
By doing so, it significantly reduces the number of customers impacted by a fault and
minimizes the length of power interruptions. This technology also helps crews locate the
fault location more quickly, leading to shorter outage durations for affected customers. The
reduction in the number of customers interrupted and the associated customer minutes of
interruptions are the primary benefits of FLISR technology and are often used as
performance metrics to evaluate the effectiveness of the system.

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Figure 8.4: automated switching before and after fault occurrence

For example, as per one of the reports of US Department of Energy which studied the impact
of FLISR in various distribution utilities of US. The report mentions five projects that
provided quantitative metrics for 266 FLISR operations they collectively implemented
between April 2013 and March 2014. Collective estimated impacts in that time period
include:
Reduced number of customers interrupted:
About 270,000 fewer customers suffered interruptions (of >5 minutes) compared to
estimated outcomes without FLISR.
Reduced outage impact:
Customers experienced about 38 million fewer minutes of interruption compared to
estimated outcomes without FLISR. On average during this time period, FLISR reduced the
number of customers interrupted by up to 45% and reduced the customer minutes of
interruption by up to 51% for an outage event.

Figure 8.5: FLISR Details in 5 American Utilities

Source:
• Smart Meters (AMI) & Outage Management System (OMS):

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In the past, power distribution companies would only become aware of power outages once
customers reported them, which was often delayed and communicated through inefficient
means. This was further complicated by the fact that not all customers would report power
outages, and those who did would do so at different times. Consequently, distribution
companies had incomplete information about the location and scope of outages, leading to
delayed response times and increased outage durations.
However, recent advancements in technology have enabled utilities to more accurately
identify and locate outages. Devices such as smart meters are now equipped with outage
notification capabilities that allow them to transmit alerts when power to the meter is lost.
These alerts include the meter number, time stamp, and location, which can then be
processed by advanced metering infrastructure (AMI) head end systems (HES). The HES
can then notify grid operators and repair crews of the location of outages and their likely
causes, which can significantly reduce response times and outage durations. Distribution
System Operators can nowadays remotely check if end-customers are connected to the
network or not.
For example, Advanced metering infrastructure can be used by MEPCOCO to transmit
consumer‐level outage and restoration notifications to MEPCO’s OMS and DMS. This data
will be used in conjunction with outage information from SCADA and customer calls to
dispatch service crews to complete repair orders.
• Distribution Transformer Monitoring System (DTMS) & Control:
The distribution transformer is a crucial part of the power system as it delivers electricity to
consumers. Although these transformers have a long lifespan of 15 years, a considerable
number of them are nearing the end of their useful life. As more consumers use electricity,
the likelihood of transformer failures increases, resulting in significant financial losses for
utilities due to unexpected outages.
Moreover, the emergence of new challenges in the current distribution grid and the desired
capabilities of a future distribution grid will necessitate the deployment of new solutions.
For instance, the increased adoption of distributed Solar PV generators at consumer
premises results in cases where power flows from a customer's premises back into the
distribution system. This reverse power flow causes the distribution transformers to
overheat and potentially decrease their lifespan.
The pie chart in the figure below represents the results of a survey conducted by Southern
Company, one of the largest utilities in the United States. The survey analyzed more than
130,000 outages that occurred over a year on over 20,000 distribution feeders (excluding
substations). The chart shows the distribution of Customer Minutes Interruption (CMI)
caused by various equipment categories. The survey found that overhead distribution
transformers were responsible for nearly 40% of the total interruptions, including both
planned and unplanned outages.

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Figure 8.6: Percentage of Customer Minute Interruptions caused by different categories of distribution grid
equipment

Through installation of Distribution Transformer monitoring System (DTMS), condition-

based monitoring of Distribution Transformers can be performed, and any abnormality
observed in its behavior can be alerted and addressed in advance, thereby reducing the
negative impact and enhancing the life of distribution transformer. This ensures continuous
supply of electricity and reduces SAIFI and SAIDI indices.
It is pertinent to highlight that K-Electric (Utility of Karachi) has installed more than 50,000
smart meters on all Pad Mounted Transformers (PMTs) in its service territory. Taking
advantage of such technology, K-Electric has been directed by regulator to submit SAIFI &
SAIDI figures by considering the outages at PMT level which will be more accurate data as
compared to other DISCOs as they are considering the outages at feeder level.
All the above are examples of how modern utility interventions impact in decreases the
outages at end consumer premises and increase the revenue. Any decrease in outage directly
improves the SAIFI and SAIDI indices.
8.5.3. SAIFI SAIDI Targets:

Distribution companies set SAIFI and SAIDI targets based on various factors such as customer
expectations, regulatory requirements, and financial implications. Utilities also consider factors
such as the age and condition of their equipment, the complexity of their network, and the potential
impact of outages on critical consumers /feeders such as hospitals, rural feeders, urban feeders or
VIP feeders. Setting these targets requires a balance between cost and reliability. A distribution
company that invests heavily in its distribution system may be able to achieve very low SAIFI and
SAIDI values, but the cost of that investment may be passed on to customers in the form of higher
rates. On the other hand, a utility that is more cost-conscious may accept higher SAIFI and SAIDI
values, but that may result in greater customer dissatisfaction and potential lost revenue from those
dissatisfied customers.
MEPCO recommended solutions and action include AMI, FLISR, OMS, DTMS as well as social
media engagements either directly or through Customer information system (web portal and
mobile apps) through which consumers can quickly interact with distribution utility in case of
outages. Once implemented, these interventions will directly reduce the SAIFI and SAIDI indices.

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However, implementation of these grid modernization actions requires MEPCO to invest heavily
on its existing distribution infrastructure. Following SAIFI and SAIDI targets are set for MEPCO
which are to be achieved at end of each phase:
Table 8.6: SAIFI &SAIDI Targets for MEPCO
Implementation of recommended
Phase Year SAIFI SAIDI
actions as per Roadmap
• Partial AMI,
• DTMS completed
Phase 1 2023-2026 • FLISR partial, <=18 <60
• Communication network partial
• SCADA partial
• FLISR complete
• AMI implemented majorly
• FLISR completed
Phase 2 2027-2029 • Communication network <15 <30
completed
• SCADA completed at old grid
stations
• AMI completed
• DMS deployed
Phase 3 2030-2032 • OMS deployed <10 <14
• FLISR completed
• SCADA completed
8.6 Energy Loss Reduction:
AT&C losses refer to the aggregate technical and commercial losses in a power distribution
system. These losses represent the difference between the amount of electricity supplied by a utility
company and the amount of electricity that is billed and collected from consumers. Technical
losses are caused by technical factors such as transmission and distribution losses, transformer
losses, and other power system losses. These losses occur due to factors such as overheating due
to overloading of Power and distribution transformers, high impedance, and other inefficiencies in
the power distribution system. These losses are often referred to as transmission and distribution
(T&D) losses.

MEPCO T&D losses during the last 5 years are mentioned in the table.

Table 8.7: MEPCO T&D Losses in terms of percentage last 5 years

Year % T&D Regulator % T&D Financial
Losses Losses Losses in
Allowed
million PKR
Million units
2021-2022 14.70 14.90 -45.4 -901.7
2020-2021 14.97 14.96 2.05 34.28

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2019-2020 15.2 15 38.65 682

2018-2019 15.8 15 154.9 2174
2017-2018 16.6 15 304.10 3101.74
Source: NEPRA PER DISCOs

Commercial losses, on the other hand, are caused by non-technical factors such as theft, billing
and metering errors and financial losses due to poor collection rates. These losses can occur due
to illegal connections, meter tampering, billing discrepancies, and other factors that can result in
lost revenue for the distribution company.

Table 8.8: Percentage of Recovery of billing amount of MEPCO

Year %Recovery Regulator Financial Loss due to deviation
from targets million PKR
Target %
2021-22 99.73 100 983.6
2020-2021 103.61 100 -9828
2019-2020 94.21 100 13,869
2018-2019 99.80 100 422
2017-2018 99.68 100 565
*Recovery from previous year

From the above tables it can be observed that MEPCO suffers more from commercial losses (theft
and recovery) than the technical losses. AT&C loss is nothing but the sum of technical and
commercial losses and shortage due to non-realization of billed amount.

AT&C Loss = (Energy input – Energy billed) * 100 / Energy input.

AT&C losses have significant financial impacts on the power distribution company, resulting in
reduced revenues and higher operational costs. Therefore, utility should aim to minimize AT&C
losses to improve financial performance and ensure sustainable operations.

8.6.1. Reduction in AT&C losses through modern interventions:

AT&C losses, utilities employ a range of strategies and technologies, such as improving the
efficiency of power transformers, upgrading transmission and distribution infrastructure,
implementing smart metering and billing systems, and using anti-theft measures such as remote
disconnect and tamper-proof meters.

• SCADA / EMS:
The reconciliation of amount of energy injected from the 132kV side of the distribution
substation and the outgoing energy from the 11kV feeders of the same substation is
necessary to ensure that the transformation losses (Transformer Losses) within the

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substation are kept in check. SCADA system not only enables real time provision of
important parameters like ampere, volts etc. instead it also provides additional feature to
reconcile the energy import into and out of the distribution substation. This is used to
evaluate the losses within a substation, which are mainly due to behavior of the power
transformer. Resultantly, maintenance of power transformers can be conducted regularly to
ensure their satisfactory performance and in case, if necessary, replacement can also be
carried out.
• Volt Var Optimization:
According to a report from “The why of volt optimization” by J. Weikert, VVO application
can potentially reduce the overall distribution line losses by 2–5%. In 2016, Pacific Gas and
Electric Company (PG&E), launched a VVO program. The program involved installing
VVO equipment, including capacitor banks and voltage regulators, on selected distribution
feeder circuits. The VVO equipment was designed to optimize voltage levels on the circuits
and reduce energy losses, ultimately improving grid efficiency and reliability.
PG&E conducted a pilot program on three circuits in the Bay Area, which resulted in an
average reduction of 4.6% in energy consumption and a decrease in peak demand of up to
8%. Encouraged by the pilot results, PG&E expanded the VVO program to over 100 circuits
by 2019.
To monitor and control the VVO system, PG&E used an advanced distribution management
system (ADMS) and smart meters at consumer premises, which included real-time
monitoring and control of distribution circuits. The ADMS helped PG&E to identify and
correct voltage violations and other grid issues in near-real time, ensuring that the system
remained stable and reliable.
8.6.2. AT&C Loss Reduction targets:

Setting AT&C loss reduction targets is a key component of utility performance management.
These targets are usually set based on industry benchmarks and best practices and are influenced
by factors such as the regulatory environment, technological capabilities, and the utility's financial
performance. By setting and achieving AT&C loss reduction targets, MEPCO can improve
operational efficiency, reduce financial losses, and ensure reliable power supply to their customers.
Over the years, average T&D losses have declined in percentage terms, but in terms of kWh and
subsequently in PKR, these have increased substantially. In this document the loss reduction
targets are set in two parts. The technical losses and commercial losses. Technical losses are
composed of T&D Losses. The following targets are set for the reduction in loss.

Table 8.9: AT&C Loss reduction targets

AT&C Losses Phase 1 Phase 2 Phase 3
2023-2026 2027-2029 2030-2032
Technical Losses
7% 5% <4%
(T&D)
Commercial Losses
>98% >99% >99.5%
in terms of recovery
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8.7 Reporting of Metrics of Roadmap

Periodic reporting on metrics of a roadmap is essential. It provides visibility and accountability.

When metrics are reported, it brings transparency to the progress and performance of the roadmap.
Stakeholders, including executives, team members, and partners (specially funding agencies), can
easily access and understand how the roadmap is progressing and whether it is meeting its intended
goals. This level of transparency holds teams accountable for their commitments and actions,
fostering a culture of responsibility and ownership.

Regular reporting helps identify areas of success and highlights potential areas that require
improvement or adjustment. The data and insights derived from metrics reporting serve as a
foundation for informed decision-making. It helps stakeholders understand the current state of the
roadmap, identify trends, patterns, and potential bottlenecks or roadblocks. With this information,
stakeholders can prioritize resources, make strategic adjustments, and allocate efforts in a way that
maximizes impact and aligns with the overall objectives of the roadmap.

MEPCO is responsible to ensure that the actions are planned and implemented in phase wise
manner. The progress report consisting of progress on each action shall be prepared by MEPCO
biannually and submitted to the review committee for review and recommendation.

Review Committee for MEPCO Roadmap:

The review authority for reviewing the progress of Roadmap should be a committee formulated
by Ministry of Energy (Power Division) comprising of officials from Ministry of Energy, MEPCO,
PPMC and /or any other independent expert(s).

Review Period:

Review period of Roadmap progress is 6 months.

Scope of Work of Review Committee:

Following shall be the scope of work of review committee:

• Review the progress of roadmap
• Review the biannual report on progress of implementation status of Roadmap by
MEPCO
• Review the progress of performance and reliability metrics in terms of achieved
targets
• Recommend measures in case of deviations
• Recommend further necessary actions to be included in the roadmap due to
technological advancements or any other reasons
• Provide high level steering actions to MEPCO

Flowchart is given in figure 8.7 for understanding the steps to ensure the progress of roadmap is
kept on track.

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Figure 8.7: Flowchart of reporting mechanism of Roadmap

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9. Financial Estimation & Models

This chapter shall provide a high-level financial estimation of the recommended initiatives in
chapter 6. The financial estimations are based on standard international practices of other power
distribution utilities. The cost of a grid modernization program for a power distribution utility can
vary widely depending on the scope and complexity of the program as well as the size and age of
the existing infrastructure.
9.1 Financial Estimates of Initiatives
This section introduces three generic categories for financial estimation of each action. It is to be
noted that the three categories are in terms of ranges and shall not be considered as a final estimate.
The exact estimates depend on many factors and require conducting extensive feasibility studies
and financial analysis.
Following three categories are introduced:
Category Financial Ranges USD Symbol
1 <50,000 $
2 50,0000 – 100,000 $$
3 100,000 – 1,000,000 $$$
4 >1,000,000 $$$$

The financial estimates for Program Area 1 has not been provided as the program area consists of
MEPCO STG , ELR and DOP programs for which the financial budget has been approved in
MEPCO business plan. For all remaining actions, the above four categories are assigned for
decision makers to identify and categorize areas where costs or revenues may be higher or lower
than expected.
Table 9.1: Financial Estimates
Financial
Code Projects Estimation
Cost Units
Estimate
Category
PA6–A1 Capacity Building ICT $ Per training
PA6–A2 Capacity Building RE $ Per training
PA6–A3 Capacity Building Business Suites ERP $$ Per training
PA6–A4 Capacity Building CX /SMM $ Per training
PA6–A5 Capacity Building Cyber Security $ Per training
PA6–A6 Capacity Building Safety & Operations $ Per training
PA6–A7 Capacity Building Leadership $ Per training
PA6–A8 Capacity Building Energy Market / MIRAD $$ Per training
PA6–A9 Capacity Building AMI $$ Per training
PA2-A3 Sectionalizers, Reclosers, Automatic Switches $$ Per feeder

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PA2-A1 Volt/Var Optimization $$ -per feeder

PA2-A5 Deployment of Sensors / Field Devices $ Per feeder
PA5-A1 Complete
Establishment of ICT Department $$*1
Job
PA5-A4 For
Dedicated Cloud $$$*2 application
mentioned
PA5-A5 Business Suites $$$*2
PA3-A3 Complete
Deployment of Smart Meters Distribution Transformers $$$
Job
PA2-A4 Complete
Deployment of Communication Infrastructure $$$$*3
Job
PA2-A6 Per
Deployment of SCADA $$
substation
PA2-A9 Complete
Deployment of DTMS $$$
Job
PA5-A2 Complete
Establishment of RE Department $$*1
Job
PA7-A4 Support to MIRAD/CTBCM $$ Per annum
PA3-A2 Deployment of Smart Meters Consumers $$$$ Complete
Job
PA3-A1 Deployment of MDMS $$$*2 For complete
AMI system
PA4-A4 Establishment of Microgrids within Service Territory $$$*4 Per
Microgrid
PA2-A2 FLISR $$*2
PA4-A2 DERMS $$*2
PA4-A3 RE Planning & Analysis Tool $$*2
PA5-A3 Social Media Management Department $$*1
PA2-A8 Deployment of DMS / EMS $$*2
PA7-A2 Privatization / Provincialization $*4
PA7-A1 Innovative Business Model $$*4
PA4-A1 Hosting Capacity Analysis $*4
PA8-A1 EV Readiness $$$*4
PA7-A5 Tariff Restructuring $*4
PA2-A7 Deployment of GIS $$*2
PA3-A5 Customer Information System $$*2
PA7-A3 Role of Unions $*4
PA3-A4 Consumer Engagement Programs $$$*4

*1 = Establishment of Departments, these intervention financial estimates are recurring and based
on no. of human resource personnel engaged and retained. Moreover, requisite equipment like
laptops, mobiles etc. also contribute to the expenses associated with the creation of such
departments.
*2 = Software Applications, various types of software applications exist which depend on the use,
functionality and the ease it brings in the decision making. Some applications help to speed up
business as usual processes while others enable planner in effective planning. The cost of each
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application varies based on the uses. Furthermore, some of these actions have expenses which are
recurring on annual or bi annual basis.
*3 = Communication Infrastructure, the deployment of communication infrastructure is a complex
topic which has several techniques and methodologies for effective communication to and from
the field devices to data centers. Many modern business models are also present which reduce the
cost. Furthermore, several technologies exist in the market which are being practiced in utilities
around the world. Therefore, estimating financial burden which a utility has to bear is complex
and not straight forward.
*4 = These interventions require feasibility studies and/or detailed analysis to be carried out. They
may also require stakeholder consultations and amendments in rules, regulations or procedures.
9.2 Modern Business Financing Models for Electric Utilities:
The amount of money and financial capital required by distribution companies for grid
modernization programs can vary widely depending on the scope and scale of the program, as well
as the specific needs and circumstances of the utility. However, in general, grid modernization
programs are expensive, with some estimates suggesting that they can cost billions of dollars to
implement.

For example, a report by the Edison Foundation estimated that the total cost of modernizing the
U.S. electric grid could range from $1.5 trillion to $2.0 trillion over the next two decades. Similarly,
a report by the International Energy Agency (IEA) estimated that global investment in grid
modernization would need to reach $1.7 trillion per year by 2030 to meet the goals of the Paris
Agreement on climate change.

Electric power distribution companies face significant challenges when it comes to arranging funds
for developing their electrical assets and modernizing their infrastructure. These companies need
to constantly invest in their infrastructure to ensure the reliable and efficient delivery of electricity
to their customers. However, infrastructure development requires significant capital investment,
which can be difficult to secure. Furthermore, distribution companies are often subject to
regulatory constraints, such as price controls and limits on returns on investment, which can further
complicate their efforts to secure financing. As a result, distribution companies must explore
innovative financing models and partnerships with external investors and stakeholders to fund their
infrastructure development projects.
MEPCO, being a cash deprived distribution company, needs to explore different financing options
to generate capital for upgrading its distribution network. Some financing models are mentioned
below:

9.2.1 Public-Private Partnerships (PPPs)

Public-private partnerships (PPPs) are a popular financing model used by utilities to fund their
infrastructure development projects. PPPs involve partnerships between the public sector and
private sector, with the private sector providing financing and expertise to develop and operate

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infrastructure projects. In a PPP, the private sector typically provides a portion of the financing for
the project, while the public sector provides regulatory oversight and guarantees a portion of the
project's revenue stream. PPPs can offer several benefits for MEPCO, including access to private
sector capital and expertise, reduced financial risk, and increased efficiency and innovation in
project development and operation.

LADWP is the largest municipal utility in the US and serves more than 4 million customers in Los
Angeles. In 2013, LADWP launched a program called "Charge Up LA!" to promote the installation
of electric vehicle (EV) charging stations across the city. However, due to limited resources,
LADWP sought to partner with private sector companies to fund and deploy the charging
infrastructure.

Under the PPP model, LADWP partnered with private sector companies to finance and install
more than 1,000 EV charging stations across the city. The private sector companies provided the
funding and expertise for the charging infrastructure, while LADWP provided regulatory support
and incentives for the deployment of the stations.

The PPP model enabled LADWP to leverage private sector investment and expertise to promote
the adoption of EVs in the city, while also maintaining a strong focus on affordability and customer
service. The model also promoted collaboration and innovation, allowing LADWP to work with
private sector partners to develop a unique solution that met the city's energy and transportation
goals.

9.2.2 Green Bonds

Green bonds are a type of debt instrument that are used to fund environmentally friendly projects,
such as renewable energy infrastructure. Green bonds offer several benefits for electric utilities,
including access to a new pool of socially responsible investors, reduced financing costs, and
enhanced reputation and credibility. However, the issuance of green bonds requires a high degree
of transparency and accountability, as investors demand detailed information on the environmental
impact and performance of the projects being funded.

An example of a green bond used for electrical asset or infrastructure development is the Enel
Finance International NV, the Group’s financial company controlled by Enel SpA, placed three
green bonds on the European market in January 2017 (1.25 billion euros), 2018 (1.25 billion euros)
and 2019 (1 billion euros) for a total of 3.50 billion euros. The proceeds were used to finance:

• new projects for the development, construction and repowering of generation plants from
renewable sources (green bond emission in 2017 and 2019)

• new projects for the development, construction, repowering and refinancing of generation
plants from renewable sources as well as projects for transmission, distribution and smart
grids (green bond emission in 2018).

The green bond issued by Enel was the first "general corporate purpose" green bond in the electric
utility sector, which means that it was not tied to specific projects or assets. Instead, the bond was
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backed by a portfolio of renewable energy and energy efficiency projects, including wind and solar
projects, as well as smart grid and energy storage projects.

The bond was structured as a 7-year note with a coupon rate of 1.75%. The bond was certified by
the Climate Bonds Initiative and was oversubscribed, indicating strong demand from investors.

Figure 9.1: Green Bond Allocation in ENEL

Source:https://www.enel.com/content/dam/enel-com/documenti/investitori/sostenibilita/2019/green-bond-report-
2019_en.pdf

9.2.3 Asset Recycling

Asset recycling is a financing model that involves leasing or selling excess land or assets to fund
infrastructure development projects. This model can offer several benefits for electric utilities,
including increased access to capital, reduced financial risk, and greater flexibility in funding
sources. However, asset recycling also requires careful management and planning to ensure that
the utility's core assets and operations are not compromised.

Australia's Asset Recycling Initiative (ARI) is a government program aimed at encouraging states
and territories to sell off public assets and use the proceeds to fund new infrastructure projects.
The program was launched in 2014 and offers financial incentives to states and territories that
participate in the initiative. Under the ARI, the Australian Government provides a financial
incentive of up to 15% of the sale price of an asset that is recycled, provided the proceeds are
reinvested in new infrastructure projects. The program is designed to help states and territories
unlock funding for new infrastructure projects, while also improving the efficiency and
productivity of the economy.

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Figure 9.2: Australian Asset Recycling Mechanism

In 2016, the New South Wales government announced a plan to sell a 50.4% stake in Ausgrid to
fund new infrastructure projects. The government received several bids for the stake, but ultimately
decided to sell it to a consortium consisting of Australian Super and IFM Investors for AUD 16.2
billion ($12.3 billion).

As part of the deal, Ausgrid agreed to a 99-year lease on its electricity network assets, which would
remain under public ownership. The funds generated from the sale were used to finance new
infrastructure projects, including new hospitals, schools, and public transportation.

The Ausgrid asset recycling model demonstrates how public power distribution companies can
leverage asset sales to generate new sources of funding for infrastructure development without
sacrificing public ownership or control. The model allows for a balance between private
investment and public ownership, which can help to support sustainable development.

Asset recycling was also used by a public power distribution company Electricity North West
(ENW) project in the United Kingdom. ENW is an electricity distribution network operator that
serves over 5 million customers in the North West region of England.

In 2018, ENW launched a £1.2 billion ($1.6 billion) project to upgrade and modernize its electricity
network over a 5-year period. The project is expected to deliver significant benefits to customers,
including improved network reliability, increased capacity for renewable energy, and enhanced
digital capabilities.

To finance the project, ENW has implemented an asset recycling model by selling a portion of its
existing network assets. In 2019, ENW sold a £1 billion ($1.4 billion) stake in its electricity
network to a consortium of infrastructure investors led by J.P. Morgan Asset Management. As part
of the deal, ENW agreed to a long-term lease on the assets, which remained under public ownership
and control.

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9.2.4 Revenue Sharing

Revenue sharing is a financing model that involves sharing the revenue generated by an
infrastructure project with external investors or stakeholders. This model can offer several benefits
for electric utilities, including reduced financial risk, increased access to capital, and enhanced
stakeholder engagement. However, revenue sharing requires a high level of transparency and
communication, as investors and stakeholders demand detailed information on the project's
performance and revenue distribution.

Revenue-sharing models have been used in several advanced metering infrastructure (AMI)
projects, particularly in public-private partnerships (PPPs). In these models, the distribution
company and the private sector partner share the revenue generated from the deployment and
operation of AMI systems. The private sector partner typically provides the financing and technical
expertise for the project, while the distribution company provides access to its distribution
infrastructure and customer base.

One example of a revenue-sharing model is the project implemented by the Karnataka Power
Transmission Corporation Limited (KPTCL) in India. In this project, KPTCL partnered with a
private sector company to deploy an Advanced Metering Infrastructure system in its service area.
The private sector company financed the project and was responsible for the design, installation,
and operation of the AMI system, while KPTCL provided access to its distribution infrastructure
and customers.

Under the revenue-sharing model, the private sector company received a percentage of the revenue
generated from the deployment and operation of the AMI system, while KPTCL received the
remainder. The revenue generated from the AMI system included not only the revenue from
metering and billing, but also revenue from other value-added services, such as outage
management and demand response.

9.2.5 Energy Performance Contracting (EPC)

Energy Performance Contracting (EPC) is a financing model that involves outsourcing the
financing and implementation of energy efficiency and renewable energy projects to a third-party
contractor. The contractor typically assumes responsibility for the upfront costs of the project and
is paid through the energy savings generated by the project over time. EPC can offer several
benefits for electric utilities, including reduced financial risk, increased energy efficiency, and
enhanced environmental sustainability.

in India, state-owned power distribution company Power Grid Corporation of India Limited
(PGCIL) has implemented an EPC project to reduce transmission and distribution losses. The
project involved the installation of energy-efficient transformers, capacitors, and other equipment
across PGCIL's transmission and distribution network.

Under the EPC model, PGCIL entered into an agreement with the project contractor, which
provided the upfront financing for the project and was responsible for implementing, operating,

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and maintaining the energy-efficient equipment. In turn, PGCIL agreed to pay the contractor for
the project over a period of 10 years using a portion of the energy savings generated by the project.

9.2.6 Community Investment Funds

Community Investment Funds (CIFs) are a financing model that involves pooling capital from
individual and institutional investors to fund infrastructure development projects in local
communities. CIFs can offer several benefits for electric utilities, including increased access to
capital, enhanced community engagement, and greater social and environmental impact.
Bristol Energy Cooperative used a CIF to finance a community solar project, installing solar panels
on the roof of a community building in the city. The CIF was structured as a community share
offer, with members of the community able to invest in the project and become owners of the solar
panels. The project generates clean energy that is used by the community building and any excess
electricity is sold back to the grid, generating revenue for the cooperative. The project has also
provided educational opportunities for local residents to learn about renewable energy and energy
efficiency.
A similar model can be adopted by MEPCO to establish microgrids in its service area. The CIF
can be made whereby off grid rural community can deposit funds. Using these funds in addition
to funding from other entities, microgrid(s) can be developed for the off grid community.
9.2.7 Revolving Loan Funds
Revolving Loan Funds (RLFs) are a financing model that involves creating a pool of capital that
can be used to fund multiple infrastructure development projects over time. RLFs typically offer
low-interest loans to utilities and other organizations to fund their projects, with the repayment of
the loans being used to replenish the fund for future projects. RLFs can offer several benefits for
electric utilities, including reduced financing costs, increased access to capital, and enhanced
flexibility in funding sources.

9.2.8 Solution as a Service (SaaS)

Solution as a Service (SaaS) is a financial model where the power distribution company (or any
other entity) outsources a complete service or solution from a vendor who owns and maintains the
assets or infrastructure. The vendor provides the solution as a service, and the payment is based on
usage or performance metrics. This financial model can help power distribution companies in
upgrading their assets without incurring a huge upfront cost or maintenance expenses. The vendor
is responsible for the maintenance, upgrades, and repair of the infrastructure, while the power
distribution company can focus on its core activities. SaaS is widely used in smart metering, energy
management systems, and other digital solutions for the power distribution sector. A notable
example of SaaS is the partnership between UK Power Networks and Piclo, where UK Power
Networks outsourced the management of its flexible grid infrastructure to Piclo on a performance-
based payment model.
9.2.9 Platform as a Service (PaaS)
Platform as a Service (PaaS) is a cloud computing model where a service provider offers a platform
that allows customers to develop, run, and manage their own applications without having to build
and maintain the underlying infrastructure. An example of PaaS for a power distribution company

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is the GridBank platform by Smarter Grid Solutions. GridBank is a cloud-based platform that
enables power companies to manage distributed energy resources (DERs) such as solar panels,
wind turbines, and batteries. It allows utilities to connect and manage these resources in real-time,
improving the stability and efficiency of the grid while reducing the need for expensive upgrades
to infrastructure. GridBank is currently used by several power utilities in the UK, Europe, and the
US.

9.2.10 Infrastructure-as-a-Service (IaaS)

Infrastructure-as-a-Service (IaaS) is a form of cloud computing service that offers compute,
storage and networking resources on-demand, usually on a pay-as-you-go basis. Businesses can
purchase resources on-demand and as-needed instead of having to buy the hardware outright.

While IaaS gives you virtualized resources such as servers, disks, networks, and IP addresses, you
are still responsible for administering the operating system, data, applications, middleware and
runtimes. A dashboard or an API gives you complete control over the entire infrastructure.

IaaS gives you the flexibility to purchase only the computing you need and scales them up or down
as needed. If you are looking to migrate an application as-is from an on-premises data center to
the cloud, choose the IaaS model. You will be able to proceed with the migration with minimum
changes.

Because of its speed of deployment, IaaS is a quick and flexible way to build up and take down
development and testing environments.

Figure 9.3: Examples for SaaS, PaaS and IaaS

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