Factories Fuel 58% Surge in Power Demand as Captive Users Return to Grid

Power

ISLAMABAD: Pakistan’s electricity consumption rebounded sharply in the final quarter of FY25, surging between 35% and 58% after two years of contraction, largely driven by industries switching back from captive generation to the national grid.

The Power Division on Friday attributed the recovery to improved macroeconomic indicators, recent power sector reforms, and the return of captive power users. Officials expressed optimism that the trend will help curb rising electricity tariffs by expanding the consumer base and spreading fixed capacity charges more efficiently.

Industrial demand jumped 58.8% in April, 47.4% in May, and 35% in June compared to the same months last year. Around 281 of 583 captive users — representing 700–750MW — rejoined the grid during April–June, lifting industrial sales from 336 million units to over 600m units.

Faisalabad Electric Supply Company reported a 183% surge in B4 category industrial sales after integrating 200MW of captive generation. Gujranwala Electric saw a 35% rise in industrial sales, Hyderabad Electric posted a 75% jump, and Lahore Electric’s B3/B4 sales grew from 996m to 1,600m units, with residential demand also up 9% due to anti-theft drives.

Multan Electric recovered 152MW of captive load, while Peshawar Electric benefited from both captive load return and a Rs7.7/unit tariff cut announced in March. Conversely, Qesco recorded lower agricultural sales due to solar adoption, and Sukkur Electric saw a 22% drop in industrial sales owing to limited captive connections.

The Power Division told Nepra that while overall Disco power purchases rose by just 0.35% against reference tariff projections, industrial sales jumped nearly 46%. However, 128,000 new connections remain pending — including 500 industrial — totalling 1,070MW of load, mostly in Fesco, Mepco, Gepco, and Iesco.

Addressing debt concerns, the division clarified that no new surcharges have been imposed. Lifeline consumers remain exempt, protected consumers pay only Rs0.43/unit, and other categories face a Rs3.23/unit debt servicing surcharge to repay Rs1.275 trillion in loans taken to settle power producer dues. Circular debt stood at Rs2.393 trillion at FY25-end.

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