Pakistan’s power generation falls to 4-year-low in FY24

Pakistan’s power generation dropped by 2% to 127,165 GWh during fiscal year 2023-2024, marking a four-year low.

The decline has been attributed to increased electricity tariffs, high inflation, and decreased economic activity, which led to a reduction in demand.

During FY24, hydel-based plants had the highest share — 31% — in electricity generation. This was followed by RLNG-based plants at 19%, and nuclear-based plants at 18%.

Meanwhile, the share of indigenous gas-based plants fell to 9% compared to a five-year average of 11% as some plants were converted to RLNG.

Issues with coal imports and transmission constraints reduced the imported coal-based plants’ share to 4% in FY24 from 9% in FY23. Conversely, the share of local coal-based plants increased to 12% as more plants were added to the system.

The share of RFO-based plants also declined to 2% in FY24 from a five-year average of 5% amid a shift to cheaper alternatives.

Wind and solar-based plants maintained shares of 3% and 1%, respectively.

The cost of power generation decreased by 6% to an average of Rs8.8/KwH in FY24.

The total cost of power generation was Rs1,115 billion in FY24, compared to Rs1,209 billion in FY23. This decline was primarily due to lower generation and the addition of relatively cheaper sources.

The cost of power generation had peaked in FY22 at Rs1,337 billion, or Rs9.34/KwH. However, the introduction of cheaper sources, such as local coal and nuclear power, has helped limit the rise in total power generation cost.

In FY24, the costs of RLNG-based plants were the highest in absolute terms, amounting to Rs565 billion (51% of the total basket cost).