ISLAMABAD: Pakistan’s fragile power transmission system is pushing electricity costs higher for consumers, with overloaded grid stations, delayed projects and poor coordination forcing the country to rely on more expensive power generation, the National Electric Power Regulatory Authority (Nepra) warned in its FY 2024-25 Transmission Performance Evaluation Report.
The regulator said weaknesses in the national grid are distorting the Economic Merit Order, the rule that cheaper power should be dispatched first, and instead compelling the system to run costlier plants. That inefficiency is directly adding to electricity tariffs paid by households and industries.
Nepra found that many grid stations and power transformers are operating beyond 80 percent of their rated capacity, exposing the system to voltage instability, equipment damage and possible outages. The report said delays in key transmission upgrades have created bottlenecks that prevent low-cost electricity generated in the south from reaching major demand centers in the north. As a result, the system has led to reliance on more expensive generation in violation of the economic merit order, increasing overall power costs.
The regulator also criticised the slow completion of expansion projects. Despite the launch of major infrastructure, including a 4,000-megawatt high-voltage direct current (HVDC) corridor from south to north, supporting substations and connecting lines have not been completed on time. Nepra observed that utilization of one major corridor remained far below its capacity, imposing “a direct financial burden on consumers despite the line’s full operational readiness.” In simple terms, consumers are paying capacity charges on assets that are not being fully used.
Karachi faces additional challenges. The city’s sole private utility, K-Electric, has struggled to fully integrate with the national grid. Nepra said delayed interconnection works between the National Transmission and Despatch Company (NTDC) and KE have limited the utility’s ability to draw cheaper surplus electricity. As a result, KE has relied more on expensive internal generation, increasing fuel cost adjustments for consumers. The regulator noted that if the interconnection had been completed, “KE could have relied more heavily on NTDC’s lower-cost surplus power, substantially lowering fuel adjustments for consumers.”
The report also flagged operational shortcomings at KE. During FY 2024-25, the utility reported 3.82 outage hours, sharply higher than 0.08 outage hours in the previous year. Although one additional interconnection point was added, bringing the total to 11, supply reliability weakened.
Nepra suggested that unless transmission projects are completed on time, grid bottlenecks removed and economic dispatch strictly enforced, Pakistan’s power consumers will continue to pay high tariffs for electricity that remains unreliable and inefficiently delivered.
