Pakistan approves national energy plan, signals push for power sector reform

Prime Minister Shehbaz Sharif on Wednesday approved the development of a comprehensive national energy plan, underscoring Islamabad’s efforts to reform the country’s power sector amid rising energy costs and economic pressures.

Chairing a meeting of the Cabinet’s Energy Sub-Committee, Sharif gave in-principle approval for the plan, which will be formulated in consultation with federal ministries and provincial governments. He also authorized the establishment of a dedicated secretariat to oversee the initiative, according to officials.

The meeting endorsed framework guidelines for the auction of wheeling charges, a key step toward opening Pakistan’s electricity market and improving transmission efficiency. Sharif directed authorities to present a coordinated and workable strategy under the proposed policy.

Providing affordable electricity to households and industrial consumers remains a top priority, he said, while instructing that inputs from the ministries of climate change, finance, petroleum, and industries be fully incorporated into the plan.

Sharif also called for accelerated privatization of state-owned electricity distribution companies (DISCOs) and the introduction of competitive tariffs aimed at boosting industrial productivity. He noted that recent reforms had already strengthened the national power transmission system and improved services for both domestic and industrial energy users.

Federal ministers Ahsan Iqbal, Sardar Awais Ahmed Khan Leghari, Ali Pervaiz Malik, and Ahad Khan Cheema attended the meeting, alongside provincial chief secretaries and senior officials.

Separately, the federal cabinet approved recommendations from the Spectrum Auction Advisory Committee, with the auction of 600 megahertz spectrum expected next month. The cabinet also reviewed the country’s broader economic situation.

Analysts said the approval of a national energy plan reflects an effort to tackle long-standing inefficiencies in Pakistan’s power sector, including high tariffs, transmission losses, and financially distressed DISCOs. While privatization and competitive tariffs could attract investment and improve efficiency, success will depend on political consensus, regulatory clarity, and sustained coordination between federal and provincial authorities.

The upcoming spectrum auction could also provide fiscal relief and signal broader reform momentum to investors, experts added.