ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has stated that underutilization of power plants, combined with excess installed capacity, significantly increased per-unit electricity costs during FY 2024–25, primarily due to higher capacity payments.
The regulator emphasized that a balanced generation mix and improved system efficiency are essential to reduce electricity tariffs.
In its Performance Evaluation Report of Operational Power Plants for FY 2024–25, NEPRA reviewed capacity utilization, generation costs, and operational efficiency under both the CPPA-G and K-Electric (KE) systems.
Although the interconnection between the National Grid and KE was energized in July 2025 — enabling transfer capacity of up to 2,000 MW — KE’s “Take-or-Pay” RLNG supply agreement for BQPS-III and related part-load charges continue to influence its generation mix and power draw patterns.
Nepra concluded that long-term sustainability requires aligning generation capacity with actual demand, prioritizing indigenous fuels, accelerating transmission upgrades, restoring non-operational low-cost plants, and carefully assessing future capacity additions.
A balanced generation mix and enhanced system efficiency, the regulator stressed, are critical to reducing electricity costs, improving reliability, and ensuring a financially sustainable power sector.
Story by Mushtaq Ghumman
