Pakistan’s power generation rose by 6% year-on-year (YoY) to 8,032 GWh in November 2024, marking the second consecutive month of annual growth in electricity production. The uptick in power output reflects a revival in economic activity, with industries and businesses witnessing higher energy demand.
However, despite the November increase, power generation in the first five months of FY25 (July-November) recorded a 4% decline YoY, standing at 58,840 GWh compared to 61,260 GWh in the same period of FY24.
Power generation cost (fuel cost) increased 2% YoY, reflecting the broader trends of rising fuel prices and input costs. However, on a month-on-month (MoM) basis, the cost saw a significant 20% decline, primarily due to a higher share of Hydel and Nuclear sources in the energy mix, which are less expensive compared to thermal generation.
Hydropower remains a cost-effective and renewable energy option for Pakistan, particularly during peak water flow seasons, while Nuclear energy provides a stable and affordable base-load alternative.
Over the first five months of FY25, the average fuel cost increased by 4% to Rs8.3 per unit. This uptick underscores the challenges posed by reliance on expensive imported fuels and fluctuating international energy prices.
The cumulative 4% YoY decline in 5MFY25 generation indicates lingering challenges, including energy conservation measures, lower seasonal demand in certain months, and disruptions in fuel supply chains.
The increase in fuel costs further compounds the sector’s financial stress, with power producers facing higher operational expenses. This often leads to a pass-through impact on end-users, making electricity more expensive for households and industries.
