Prime Minister Shahbaz Sharif’s approval of the revised Indicative Generation Capacity Expansion Plan (IGCEP 2025–35) marks a rare—and welcome—departure from the decades of mismanagement and rent-seeking that have plagued Pakistan’s power sector. By scrapping 7,967 megawatts of high-cost projects and rescheduling others, the government claims savings of $17 billion—a staggering figure that exposes the sheer waste embedded in the old system.
For years, Pakistan’s energy planning operated as a parallel economy, prioritizing political patronage over national interest. The shift away from expensive, imported fuels toward local hydro, wind, solar, and nuclear sources is not just logical—it is long overdue. The fact that it took an energy crisis to recognize the folly of locking the country into exorbitant capacity payments and sovereign guarantees speaks volumes about past failures.
A Step in the Right Direction—But Why So Late?
On paper, the reforms are sound:
- The original 14,984MW expansion target has been halved, with a focus on cost-effective, domestically sourced energy.
- The single-buyer model is being phased out, capacity charges eliminated, and competitive bidding introduced—all essential steps toward a functional electricity market.
Yet, these measures should have been implemented a decade ago. Instead, power projects were awarded on a cost-plus basis, creating a glut of idle capacity and driving up consumer tariffs. The real test now is whether this reform effort goes beyond cosmetic adjustments and dismantles the culture of inefficiency and impunity that enabled such waste.
K-Electric’s Exclusion: A Missed Opportunity?
The decision to exclude K-Electric’s renewable energy proposals from the IGCEP raises questions. While officials justify it by citing alternatives like Thar coal and nuclear power, the move risks deepening the divide between Karachi’s power utility and federal planners. KE’s directive to chart its own timeline for connecting to the National Grid may be technically sound, but it underscores the persistent failure to integrate energy planning across jurisdictions.
A Cautionary Tale in Reactive Policymaking
The fact that the IGCEP was revised only after falling demand, rising net metering, and underutilized capacity forced a rethink is telling. Officials now admit that previous versions of the plan were packed with projects lacking even basic financial or construction progress. That 15,000MW of such “committed” capacity has been scrapped or delayed confirms just how broken the system was.
The Real Challenge: Changing the System, Not Just the Numbers
Cutting megawatts is easy; rooting out corruption, bureaucratic inertia, and contractual exploitation is not. For these reforms to succeed, they must be backed by:
- Regulatory clarity and professional independence
- Strict accountability for those who looted the sector in the past
- A genuine commitment to transparency, not just rhetoric
The Road Ahead
Consumers want affordable, reliable electricity. Producers need clear rules and predictable returns. And Pakistan desperately needs a power sector that fuels, rather than stifles, economic growth. The IGCEP 2025–35 offers a framework—better late than never. But if old habits resurface under new labels, this chance at reform may be wasted. The government must prove that this is more than just another false dawn.
