THE government’s decision to curtail gas to captive power plants is a significant step towards addressing Pakistan’s power cha-llenges. This shift is essential for reducing power tariffs and stabilising the supply.

The power sector’s fixed capacity costs currently rise as demand falls. By moving industrial consumers onto the grid, we can stabilise the demand, reduce the fixed charges, and bring down electricity costs. For industries, this transition aligns with the recent winter support package announced by the federal government, which has reduced rates for incremental power usage from December to February. This package, alongside grid integration, will help industrial consumers cut costs, enhancing their competitiveness.

Although this reform is challenging, delaying it could compromise Pakistan’s economic stability, especially given the conditions imposed by the International Monetary Fund (IMF). With careful implementation, this transition will lead to a more robust national power sector that provides reliable and affordable electricity to businesses and people alike.

Tanzeel Khanzada
Karachi

Published in Dawn, January 4th, 2025