Islamabad: Pakistan’s national electricity grid generated 4.6 percent more power in March 2025 compared to the same month in 2024.
However, this figure masks a troubling reality: March 2018 saw higher generation levels than March 2025, marking the second consecutive month where output has lagged behind seven-year-old figures.
This stagnation is even more concerning when viewed in the broader context.
Cumulative electricity generation for the first nine months of FY25 stands at 87 billion units, the lowest in five years, and is 12 percent lower than the peak of FY22.
The monthly average generation, based on a 12-month rolling average, has fallen back to levels last seen in September 2019, when Pakistan first breached the 10 billion mark in monthly output.
Despite facing a scorching summer and a winter incentive package aimed at boosting consumption, the energy sector remains stuck.
The most pressing issue is the fragile generation mix. Hydel output in March 2025 fell sharply by nearly a billion units from the previous year, with Neelum-Jhelum offline and overall hydrology underperforming.
RLNG Reliance
As a result, Pakistan has been forced to rely more heavily on RLNG (Re-gasified Liquefied Natural Gas), the costliest fuel, further inflating the energy bill.
While nuclear energy has contributed when possible, the over-reliance on RLNG is straining the system.
Demand-side challenges are equally concerning. Residential consumption per connection dropped to a 20-year low in FY24, while industrial usage reached record lows.
Structural issues, such as rising tariffs, unresolved transmission constraints, and the exodus of industries from the grid to solar and self-generation solutions, have further dampened demand.
The middle-income segment has been particularly affected, with many households cutting down their energy consumption due to ongoing tariff shocks.
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Additionally, rooftop solar adoption continues to grow among higher-income households, indicating a shift away from the national grid.
Despite efforts to address commercial losses, including tariff adjustments and Fuel Cost Adjustments (FCA), load-shedding persists, not due to fuel shortages but because of inefficiencies in loss management.
While recent tariff cuts have failed to reignite demand, the fundamental issue lies in systemic inefficiencies and governance failures.
Without comprehensive reforms and a willingness to implement them, Pakistan’s grid risks becoming obsolete, unable to meet the power demands of the future.
Also Read: Payment Delays Could Cause Power Generation Issues
The necessary blueprint for reform exists, but it remains to be seen whether the political will to act will emerge. Story by AHmed Mukhtar.
