Pakistan’s energy sector stands at a critical juncture, burdened by inefficiencies, aging infrastructure, and persistent circular debt. The Power Planning and Monitoring Company (PPMC), established in October 2021 to address these challenges, has yet to become operational. Its predecessor, the Pakistan Electric Power Company (PEPCO), failed to deliver on its mandate due to bureaucratic inefficiencies and unclear governance after WAPDA's unbundling. To avoid repeating these mistakes, Pakistan must learn from PEPCO’s failures and draw lessons from successful energy governance models, such as India’s Central Electricity Authority (CEA).
India’s CEA operates as a technical advisor, regulator, and policymaker under the Ministry of Power and has achieved significant milestones. It has integrated renewable energy into the grid, implemented cost-reflective tariffs, and established performance benchmarks, stabilising India’s energy market. These reforms reduced subsidies, enhanced affordability, and minimised financial burdens. Pakistan’s centralised and bureaucratic governance has hindered similar progress. Decision making remains concentrated in the Power Division, which is not equipped to address the complexities of the sector.
A transformed PPMC, restructured into the Power Planning and Monitoring Authority (PPMA), could address Pakistan’s energy challenges. This reimagined authority must be granted legislative powers to regulate, enforce, and implement policies independently, free from bureaucratic interference. The PPMA could oversee the entire energy value chain i.e. generation, transmission, and distribution while accelerating renewable energy integration and setting performance benchmarks for distribution companies (DISCOs).
Pakistan’s untapped renewable energy resources are among its most significant assets. The country has a wind energy potential of 120 GW in Sindh, the north, and offshore areas, yet only 1.5 GW is utilised. Hydropower offers 41 GW of potential, but only 10.6 GW has been harnessed. The Thar coalfields, among the largest lignite coal reserves globally, could generate up to 20 GW of electricity, and nuclear energy capacity could expand from 1.1 GW to 20 GW in the coming decades. The PPMA could play a transformative role by coordinating efforts to utilise these resources, reducing reliance on costly imports, and diversifying the energy mix for self-sufficiency.
By restructuring the PPMC into an empowered PPMA, Pakistan can emulate global success stories like India’s CEA. Such reforms could eliminate circular debt, reduce energy costs, and drive industrial growth, laying the foundation for a sustainable energy future
Circular debt remains a major barrier, undermining financial stability and deterring investment. Pakistan can learn from India’s Ujwal DISCOM Assurance Yojana (UDAY), which restructured the debt of distribution companies through operational reforms under CEA oversight. Similarly, the PPMA could introduce cost-reflective tariffs, protect vulnerable consumers with targeted subsidies, and implement advanced metering infrastructure (AMI) to curb theft and billing inaccuracies. By setting performance benchmarks for DISCOs and adopting a debt management program, Pakistan can stabilise its energy finances.
Data-driven governance is critical for transparency and efficiency. Tools such as live dashboards can track performance across generation, transmission, and distribution in real time. Predictive analytics, powered by artificial intelligence, could identify inefficiencies, forecast demand, and prevent outages. Policy simulation models would enable evidence-based decisions tailored to real-world challenges. These strategies could help the PPMA modernise the power sector, enhancing reliability and accountability.
Engaging Pakistan’s diaspora is another untapped opportunity. Many professionals working on advanced energy projects abroad possesses the expertise and networks to modernise Pakistan’s power systems. Countries like India and Nigeria have successfully mobilised their expatriate communities to drive innovation and investment. Pakistan could adopt similar strategies by creating diaspora energy forums and offering financial incentives to attract global talent for Renewable energy projects and grid modernisation.
Affordable electricity is crucial for industrial growth and economic development. Countries like China, Vietnam, and Bangladesh have demonstrated how low energy costs attract foreign direct investment (FDI), boost exports, and create jobs. Vietnam’s affordable electricity has drawn major investors like Samsung and Intel. Pakistan could align its energy policies with industrial strategies, ensuring cost-effective and reliable energy to position itself as an attractive destination for investors. The PPMA could play a central role in delivering affordable energy to stimulate economic growth.
Regional energy trade offers another avenue for strengthening Pakistan’s energy sector. Projects like CASA-1000, which imports surplus hydropower from Central Asia, highlight the benefits of cross-border collaboration. Grid interconnections with India, Afghanistan, and Iran could stabilise supply and reduce costs. Exporting surplus renewable energy from wind, solar, and hydropower resources could generate foreign exchange and reduce reliance on fossil fuels. These initiatives could position Pakistan as a key player in regional energy markets.
Transforming PPMC into the PPMA will face challenges, including resistance from entrenched bureaucracies, legislative delays, and conflicts of interest. Transparent communication, phased implementation, and pilot projects could address these hurdles. Aligning legislative frameworks with the PPMA’s mandate is essential to avoid jurisdictional conflicts and ensure smooth operations. Policymakers must balance affordability, financial sustainability, and infrastructure development to benefit consumers and the national economy.
The urgency for reform is clear. By restructuring the PPMC into an empowered PPMA, Pakistan can emulate global success stories like India’s CEA. Such reforms could eliminate circular debt, reduce energy costs, and drive industrial growth, laying the foundation for a sustainable energy future. With strong governance, international collaboration, and data-driven strategies, Pakistan can turn its energy challenges into opportunities, ensuring a brighter and more prosperous future for generations to come.