Study highlights that the country has become one of the main solar markets in five years
ISLAMABAD:
Electricity prices in Pakistan have risen 155% in the last three years, with capacity payments and the depreciation of the rupee identified as the main drivers, according to a new assessment that underlines the growing pressure on household finances across the country.
In several areas, electricity bills have exceeded housing rents, reflecting the intensity of the crisis and forcing consumers to look for alternatives. Expensive grid electricity has forced a growing number of consumers to opt for solar panels, according to a report.
The Competition Commission of Pakistan (CCP), in a detailed study of the solar energy sector, titled ‘Competitive Assessment of Solar Energy Market in Pakistan’, has pointed out structural inefficiencies and barriers that limit competition and investment.
The study highlights that the country has become one of the main solar markets in five years, with an installed capacity that reaches 35 gigawatts and imports exceeding 50 gigawatts. However, it points out that millions of consumers remain without access to electricity.
The commission recommended urgent improvements to the transmission network, the introduction of smart metering systems and grid automation, along with a broader transition towards renewable energy, noting that Pakistan’s solar potential far exceeds its current needs.
The study notes that most solar energy use in the country remains undocumented, while the proliferation of substandard equipment is harming both consumers and the integrity of the market. It also warns that Pakistan, being among the countries most vulnerable to climate change, faces growing economic losses that could reach up to 6% of GDP by 2050.
Under the current framework, only a limited amount of electricity generated through net metering is connected to the grid. However, the report notes that solar energy adoption tends to increase with income levels, a trend further accelerated by falling prices for solar panels and batteries, making off-grid solutions increasingly attractive.
Highlighting systemic weaknesses, the PCC has identified transmission infrastructure failures, political ambiguity and product quality concerns as key challenges.
