AHL Research conducted a critical review of the Pakistan Power Sector’s production occurred in July 2025, noting a 5% year-over-year decline in power generation alongside negative Fuel Charge Adjustments (FCA). 

In July 2025, power generation decreased by 5% compared to July 2024, reaching 14,123 GWh (equivalent to 18,983 MW), down from 14,880 GWh (20,000 MW) the previous year. However, there was a 3% increase in power generation compared to the previous month.

The reduction in power generation during July was mainly due to decreased demand influenced by the monsoon season, particularly in Punjab and Khyber Pakhtunkhwa.

Importantly, imported coal-based generation remained consistent year-over-year at 1,140 GWh in July 2025, though it was 23.4% below the reference target. Local coal-based generation also held steady year-over-year at 1,503 GWh, but it was 17.7% below its reference target.

Gas-based generation saw a decline of 7.4% year-over-year and was 13.1% lower than the reference level. On a positive note, wind power generation increased by 33.0% year-over-year and was 12.5% higher than the target generation. Solar power generation, meanwhile, declined by 4.5% year-over-year but still stood 11.7% above its reference level.

Nuclear generation experienced a significant decline of 29.3% year-over-year, falling short of its reference generation by 16.8%. Additionally, RLNG-based generation dropped by 17.9% year-over-year and was 18.6% below the target for July 2025. Hydel generation, however, increased by 6.1% year-over-year and was 6.7% above the reference level.

The cost of power generation in July 2025 was PKR 7.78 per kWh. When accounting for transmission losses and previous adjustments, the effective fuel cost reached PKR 8.18 per kWh. This actual fuel cost is lower than the reference fuel cost of PKR 9.88 per kWh, leading to a projected decrease of PKR 1.69 per kWh in the fuel charge adjustment, which will be refunded to customers in the September 2025 electricity bill.

In summary, power generation in July 2025 was 10.1% lower than the reference generation, which was set at 15,714 GWh. The accumulated shortfall amounted to 1,591 GWh, reflecting a decline compared to the reference generation.

Courtesy: AHL Research