Pakistan’s power price dilemma

Easy access to affordable energy is pivotal for fostering economic growth and enhancing the social prosperity of the nation. However, it has remained a distant dream for many in our country due to inflated energy costs. As is well known, the roots of soaring power prices lie in poor governance, policy lapses, volatile global energy prices, and rupee devaluation. Currently, a substantial segment of the country’s population is trying to grapple with exorbitant energy prices, which calls for deep introspection into major loopholes in the current policy framework and devising better consumer-centric policies. The recent surge in electricity prices directly results from expensive power production, capacity payments against surplus power, circular debt, and indirect taxes. Pakistan’s power generation heavily relies on conventional energy sources (eg imported fossil fuels), which are vulnerable to international market price volatility and foreign exchange rates, resulting in a high cost of electricity generation.