As temperatures climb, Pakistan is once again heading into a challenging season for its power sector. Authorities are preparing a set of measures to deal with a sharp rise in electricity demand, including planned outages, conservation campaigns, and higher tariffs. While these steps aim to keep the system running, they are also expected to put additional pressure on consumers already dealing with high living costs.
At the heart of the issue is a widening gap between electricity demand and available supply. In the coming weeks, peak demand is projected to reach around 27 to 28 gigawatts. Meeting this level of consumption is proving difficult due to constraints in fuel availability and generation capacity. As a result, households and businesses may face a mix of higher bills and more frequent power interruptions.
One of the primary causes of the shortfall is disruption in fuel supplies. Liquefied natural gas (LNG), which plays a key role in electricity generation, has become less reliable due to supply issues and rising global prices. At the same time, output from domestic coal sources has not scaled up as expected. To fill the gap, power producers are turning to alternatives like furnace oil and imported coal—both significantly more expensive options.
These shifts come at a cost. Analysts estimate that reduced LNG availability alone could lead to a substantial drop in electricity generation over the summer months. Replacing that lost energy with costlier fuels may add over Rs100 billion to the system’s financial burden. This, combined with existing inefficiencies, is likely to be passed on to consumers through fuel cost adjustments.
Electricity tariffs are therefore expected to rise by Rs6 to Rs8 per unit. For many households, this could push average electricity rates beyond Rs55 per unit, making cooling appliances like air conditioners even more expensive to run during peak summer heat. The increase will be particularly difficult for middle- and lower-income families who already allocate a large portion of their income to utilities.
The government is also exploring ways to boost supply using domestic resources. However, these options come with their own limitations. Natural gas production within the country is already insufficient, meeting less than 70 percent of total demand. Redirecting gas toward power generation could disrupt fertiliser production, potentially affecting agriculture and food supply chains.
Similarly, expanding coal-based generation faces logistical hurdles. Infrastructure development, transportation challenges, and delays in long-term agreements have slowed progress. While local coal remains a promising resource, it is not yet capable of fully bridging the supply gap in the short term.
Beyond the immediate impact on electricity users, the situation has broader economic implications. Increased reliance on imported fuels will raise the country’s import bill, putting further strain on foreign exchange reserves. At the same time, higher generation costs could worsen the financial challenges already faced by the power sector, including circular debt.
In essence, policymakers are dealing with a difficult balancing act. Ensuring uninterrupted power supply requires expensive fuel imports, which drive up tariffs. On the other hand, limiting costs may lead to more frequent outages. Either way, the burden is shared by consumers and the wider economy.
As the summer unfolds, the outlook for the power sector will depend heavily on global energy markets, fuel availability, and the effectiveness of policy measures. For now, it appears that consumers should prepare for a season marked by both higher electricity costs and the possibility of regular load shedding.