The central government of Pakistan has announced plans to open the country’s electricity market, allowing consumers to choose their power suppliers for the first time in the nation’s history. From January 2026, consumers using one megawatt or more could choose their electricity supplier.
The development was revealed during a briefing by Power Division Secretary Dr Fakhar Alam Irfan to the National Assembly’s Standing Committee on Power.
Secretary states that the government was already moving towards an open electricity market, adding that increased competition would help ensure fairer prices for consumers.
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He also underscored one of the sector’s most persistent problems, circular debt, noting that while it had stabilised during the last three years, it remained a major concern.
The Secretary power division further stated that in 2024, financial losses in the power sector stood at Rs600 billion. He claimed that in current year, government has reduced them to Rs397 billion, adding that further reductions were in underway.
Dr Irfan explained that losses exceeding the National Electric Power Regulatory Authority’s (NEPRA) targets do not immediately affect consumers but eventually add to the circular debt, which is ultimately covered by the federal budget.
He further directed that power feeders with losses of up to 20 percent should not be shut down, warning that such closures harm both consumers and government revenues.
Karachi’s Power Crisis
In the standing committee meeting, member Shahida Rehmani voiced concerns over Karachi’s persistent electricity crisis.
She said that Karachi was a megacity but was served by only one power company, K-Electric. She added that the city faced severe electricity and infrastructure problems, and while announcements were often made, implementation was lacking.
The committee was also briefed on the rapid rise of solar energy across Pakistan. officials cautioned that the growing share of solar power is creating new challenges for the national grid. Electricity supplied through the grid includes around Rs14 in capacity charges and Rs9 in taxes per unit, making it far pricier than solar-generated power.