Pakistan's power costs are soaring, jumping a significant **20%!** This surge is happening amidst a dramatic overhaul of the country's power generation landscape. Let's dive into the details, shall we?
In October 2025, Pakistan's power sector generated a total of 9,886 GWh, which is a 4% decrease compared to the same month the previous year, according to data from Arif Habib Limited. The most significant shift is the rise of nuclear power, which is becoming the dominant source, while renewable energy sources show mixed results.
Nuclear power is leading the charge, increasing by a substantial 52% year-on-year, reaching 2,188 GWh in October. This now accounts for 22.1% of the total generation mix, up from 14.1% the previous year. This makes nuclear the single largest contributor to Pakistan's power grid for the month, demonstrating the country's strategic focus on base-load nuclear capacity. For the first four months of fiscal year 2026 (4MFY26), nuclear power has generated 7,965 GWh, a 10% increase from 7,216 GWh in 4MFY25, now contributing 15.7% of total generation.
Hydroelectric power, traditionally a cornerstone of Pakistan's energy supply, generated 2,705 GWh in October 2025, a 15% decrease from 3,187 GWh in October 2024. Hydel's share of the generation mix fell to 27.4% from 31.1% year-over-year, which is likely due to seasonal water availability issues. Even with this monthly dip, hydel remains the second-largest contributor to Pakistan's power mix. Year-to-date generation is essentially flat at 18,673 GWh, compared to 18,728 GWh in the same period last year.
Re-gasified Liquefied Natural Gas (RLNG) plants saw a 3% year-on-year decline in October, producing 1,949 GWh compared to 2,003 GWh last year. The RLNG share in the generation mix decreased to 19.7% from 19.5%. Cumulatively for 4MFY26, RLNG generation reached 8,382 GWh, down 8% from 9,118 GWh in 4MFY25. This decline reflects both economic dispatch considerations and the higher costs associated with imported LNG.
Local coal-fired plants generated 1,261 GWh in October, down 17% year-on-year, while imported coal plants produced 466 GWh, a steep decline of 48%. Combined, coal's share in the generation mix stands at 17.5%, down from 23.0% in October 2024. The shift away from coal shows Pakistan's changing energy economics and environmental considerations, though imported coal plants are bearing the brunt of reduced utilization due to higher fuel costs.
Solar power generation dipped by 3% year-on-year to 96 GWh in October, holding a modest 1.0% share of total generation. Year-to-date solar output remains steady at 413 GWh. Wind power showed resilience, generating 185 GWh in October, down 3% year-on-year, but maintaining its 1.9% share. Cumulative wind generation for 4MFY26 reached 1,631 GWh, up 14% from 1,428 GWh last year.
And here's where it gets controversial... Residual Fuel Oil (RFO) plants experienced extraordinary growth, surging a staggering 2,300% year-on-year to 48 GWh in October, compared to just 2 GWh last year. Although it still represents only 0.5% of the mix, this dramatic increase suggests operational adjustments in response to grid requirements. Year-to-date RFO generation stands at 345 GWh, up 132% from 149 GWh. The increased use of RFO plants, despite their high fuel costs, suggests that system operators are prioritizing grid stability and meeting peak demand over pure cost optimization.
Average fuel costs increased by 20% month-on-month to Rs8.51/kWh in October from Rs7.09/kWh in September, reflecting the changing generation mix and pressures from imported fuel prices. This sharp increase highlights the challenges Pakistan's power sector faces in balancing supply reliability with cost management. RFO remained the most expensive fuel source at Rs32.69/kWh, up 16% from September's Rs28.24/kWh. RLNG costs provided some relief, declining 7% to Rs21.06/kWh from Rs22.19/kWh in September, although it remains among the more expensive options in the fuel mix.
Domestic fuel sources also saw upward pressure. Local coal costs rose 17% to Rs13.10/kWh from Rs11.19/kWh, while gas declined modestly by 6% to Rs13.36/kWh from Rs14.25/kWh. Most notably, baggasse costs surged 84% to Rs10.74/kWh from Rs5.85/kWh, the sharpest increase among all fuel types, showing seasonal availability constraints and demand dynamics in the biomass fuel market.
The data reveals Pakistan's ongoing energy transition, with nuclear and hydel together accounting for nearly half of total generation (49.5%). The reduced reliance on expensive imported fuels like RLNG and imported coal, combined with stable nuclear output, suggests efforts to optimize the generation mix for cost efficiency. However, the 4% year-on-year decline in total generation may indicate weak electricity demand amid economic headwinds, warranting close monitoring of the power sector's financial health and circular debt dynamics.
Comparative Generation Mix Analysis
| Source | Oct-25 Share | Oct-24 Share | Change (pp) |
|-----------------|--------------|--------------|-------------|
| Hydel | 27.40% | 31.10% | -3.7 |
| Nuclear | 22.10% | 14.10% | 8 |
| RLNG | 19.70% | 19.50% | 0.2 |
| Coal (Local) | 12.80% | 14.80% | -2 |
| Gas | 9.20% | 8.00% | 1.2 |
| Coal (Imported) | 4.70% | 8.80% | -4.1 |
| Wind | 1.90% | 1.90% | 0 |
| Solar | 1.00% | 1.00% | 0 |
| RFO | 0.50% | 0.00% | 0.5 |
| Others | 0.80% | 0.90% | -0.1 |
Key Performance Indicators: 4MFY26 vs 4MFY25
| Metric | 4MFY26 | 4MFY25 | YoY Change |
|--------------------------|---------|---------|------------|
| Total Generation (GWh) | 50,819 | 50,808 | 0% |
| Nuclear Generation (GWh) | 7,965 | 7,216 | 10% |
| Hydel Generation (GWh) | 18,673 | 18,728 | 0% |
| RLNG Generation (GWh) | 8,382 | 9,118 | -8% |
| Coal Total (GWh) | 9,171 | 9,461 | -3% |
| Renewables (Wind+Solar) (GWh) | 2,044 | 1,840 | 11% |
So, what do you think about these shifts in Pakistan's energy landscape? Are you optimistic about the move towards nuclear and renewables, or do you have concerns about the rising costs? Let us know your thoughts in the comments below!
