Across the sunbaked plains of southern Punjab, the rocky plateaus of Balochistan, and the arid expanses of Sindh, a silent energy revolution is quietly transforming lives. In many remote and underserved areas where the national grid has either never arrived or remains notoriously unreliable, modest off-grid solar systems – often ranging from just 100 to 500 watts – have become the first and sometimes only source of electricity. These small but impactful installations power homes, fans, mobile phones, and even small irrigation pumps, replacing diesel generators and kerosene lamps with clean, accessible energy.
This grassroots transformation marks Pakistan’s energy leapfrog moment, much like how mobile phones bypassed landlines across South Asia. Solar power is reaching places before paved roads, clinics, or schools. Although these changes might not yet appear in official energy statistics, they are fundamentally reshaping livelihoods, empowering marginalized communities, and offering a glimpse of a decentralized energy future.
In April 2025, Nawabshah sweltered under record temperatures near 50 degrees Celsius, among the hottest in the world that month. Such extreme weather events underscore Pakistan’s frontline position in the global climate crisis. Amid growing climate vulnerability, the country experienced an unprecedented surge in solar panel imports – over 17 gigawatts in 2024 alone – reflecting a rapid, though uncoordinated, embrace of solar energy.
However, this surge is less a reflection of cohesive climate policy and more an improvised response by urban elites and businesses fleeing chronic grid failures, soaring tariffs, and erratic power supply. Largely unregulated and disconnected from national planning, this boom risks creating a two-tiered energy system: reliable, clean power for those who can afford to go off-grid, and deteriorating, fossil-fuel-dependent supply for the vast majority still reliant on the conventional grid.
In cities, fossil fuel-powered generators – once considered emergency backups – have become the default electricity source for homes, hospitals, and businesses. In 2022, Pakistan spent over $1 billion on importing these polluting machines; however, this trend has declined due to the growing adoption of solar energy. Yet they remain untaxed, unregulated, and outside formal energy planning, eroding public trust in the state’s capacity to ensure reliable and affordable power.
Uncoordinated Power: The Missing Links in Pakistan’s Energy Architecture
Despite a total installed generation capacity of 42,131 megawatts (MW), Pakistan continues to face energy shortages and systemic inefficiencies. The root problem is not just generation, but the absence of an integrated national energy policy that aligns electricity demand, generation, transmission capacity, and the rapid expansion of stand-alone solar systems.
In 2023-24, Pakistan generated 92,091 gigawatt-hours (GWh) of electricity – at annual average generation of just 10,513 MW – well below the country’s installed capacity and potential. Seasonal fluctuations intensify the challenge: while demand peaks at around 12,000 MW in winter, it surges to nearly 30,000 MW in summer, exposing a staggering 18,000 MW gap during the hottest months. Given Pakistan’s population of over 250 million and the size of its economy, these figures hint at a deeper, largely overlooked reality: a vast, unaccounted volume of off-grid electricity is being generated and consumed outside the formal power system. This hidden energy economy, driven by solar panels and diesel generators, is neither fully documented by government bodies nor regulated by energy authorities, masking the true scale of electricity access and demand in the country.
On the transmission side, the National Transmission and Despatch Company (NTDC) operates a network with a reported capacity of 37,190 MVA (approximately 37,000 MW). However, its performance is hampered by aging infrastructure, geographic mismatches between power generation and demand centers, and high transmission and distribution (T&D) losses – measured at 18.31 percent in fiscal year 2023-24, significantly exceeding the permissible limit of 11.77 percent. Despite sufficient installed generation capacity, infrastructure limitations have led to the underutilization of available power. As a result, escalating capacity charges are being incurred for electricity that is neither generated nor delivered. These costs are ultimately borne by consumers still reliant on the national grid.
Despite persistent structural challenges, the government remains focused on expanding centralized power generation. According to the Economic Survey of Pakistan 2023-24, the Private Power and Infrastructure Board (PPIB) is facilitating 24 utility-scale projects totaling 7,460 MW across coal, hydropower, and renewable sources. While these initiatives reflect a continued effort to increase capacity, they remain largely disconnected from the rapid, consumer-driven growth of distributed solar energy. Furthermore, they show little coordination with seasonal demand fluctuations or the increasing adoption of off-grid systems, revealing a significant disconnect between national energy planning and the evolving realities on the ground.
Concurrently, the unregulated import of over 17 GW of solar panels in 2024 highlights a parallel, decentralized energy transition led by households and businesses aiming to overcome load shedding, high tariffs, and unreliable electricity supply. This surge in solar adoption – largely absent from official energy statistics – signals a public shift toward energy autonomy. However, without strategic integration into grid infrastructure and coherent policy frameworks, this fragmented system risks worsening grid instability, distorting tariff structures, and deepening energy inequities, particularly among those who remain dependent on the national grid.
Strategic Course Correction: Toward a Unified and Just Energy Transition
To bridge this widening divide, Pakistan must fundamentally reset its energy policy framework, placing decentralized energy at the heart of its national strategy. Off-grid and rooftop solar should no longer be viewed as peripheral or disruptive, but rather as central pillars of a resilient, climate-smart, and democratized energy future. This shift requires not only national recognition of decentralized systems but also delegating greater authority to provincial governments to plan, regulate, and scale localized energy solutions.
Provinces are best positioned to tailor off-grid deployment to local needs, especially in remote and underserved areas where centralized infrastructure is weak or absent. Policy reforms must therefore support equitable net billing frameworks, empower provincial regulatory bodies, incentivize small producers, and accurately value distributed generation. Most importantly, utility-scale and decentralized systems must be integrated within a unified, long-term renewable energy vision – one that balances national oversight with localized implementation to ensure inclusive and adaptive energy access for all Pakistanis.
The World Bank’s Energy Efficiency Roadmap for Pakistan provides a valuable blueprint, advocating for empowered local governments, robust public-private partnerships, and scaled deployment of off-grid solar, especially in underserved provinces like Balochistan and Gilgit-Baltistan. To make the energy transition inclusive, the government must offer targeted support – through subsidies, microfinance, and community energy models – to expand solar access for low-income and rural households. Financial innovations like results-based financing (RBF), concessional loans, and tax incentives can accelerate uptake.
Simultaneously, Pakistan must regulate and phase out diesel generators, replacing them with solar-plus-storage systems, hybrid microgrids, and energy-efficient appliances. Essential reforms include generator registration, import monitoring, and fuel consumption tracking.
Lastly, developing local manufacturing capacity and a skilled solar workforce is vital. Expanding vocational training, certifying technicians, and supporting small and medium enterprises could create over 20,000 full-time jobs annually, contributing to economic growth alongside energy access.
Empowering Provincial Authorities: Decentralizing Transmission and Regulation for a Resilient Grid
The efficiency of Pakistan’s power sector and the resilience of its grid hinge on empowering provincial authorities to take a proactive role in electricity transmission. Alongside the NTDC, provinces should establish Provincial Transmission Utilities (PTUs) to manage intra-provincial transmission networks. This decentralization would enable region-specific planning, faster demand response, smoother integration of local renewable energy sources, and help alleviate congestion challenges inherent in a fully centralized system.
Moreover, provincial bodies should assume regulatory oversight of decentralized generation within their jurisdictions, operating under the unified national policy framework provided by NEPRA. Distributing operational and regulatory responsibilities between federal and provincial levels will create a more flexible, accountable, and efficient electricity sector. Such a governance model will foster sustainable growth, promote equitable access, and enhance coordination between centralized and decentralized energy infrastructure.
The United States provides a useful precedent: the Federal Energy Regulatory Commission (FERC) oversees interstate transmission and wholesale markets, while state Public Utility Commissions (PUCs) regulate intrastate transmission and retail markets. This division allows states to tailor policies to local needs, ensuring broad grid reliability and responsiveness.
By adopting a similar model, Pakistan can empower provinces to own their transmission and decentralized generation assets while maintaining national coherence through NEPRA — paving the way for a resilient, inclusive energy future.
Learning from Neighbors: Regional Pathways to Energy Inclusion
Pakistan is not alone on this path. Bangladesh has electrified over 20 million people using solar home systems supported by microfinance, subsidies, and effective regulation. India is advancing distributed energy through rural mini-grids and rooftop solar mandates, particularly in states like Bihar and Uttar Pradesh. Nepal’s community-owned micro-hydro and solar cooperatives, backed by strong local governance and donor support, offer further lessons.
Regional experience underscores a vital truth: decentralized energy can be scaled equitably only when supported by inclusive policies, robust regulatory frameworks, and long-term planning that prioritize affordability and access.
From Energy Fragmentation to Energy Justice
Pakistan’s off-grid solar boom holds immense promise. But without strategic guidance and integrated policy, it risks reinforcing inequality instead of resolving it. With over 25 million people still lacking reliable electricity, incremental fixes are no longer enough.
What Pakistan urgently needs is a bold, inclusive national strategy that unites large-scale investment with grassroots innovation, central planning with provincial empowerment, and climate ambition with social justice.
Climate change has only amplified what nature already provides in abundance – sunlight. The sun shines generously across Pakistan, offering more than enough solar potential to power the nation. The real question is whether this energy will be shared by all – or hoarded by a few. The choices made today will decide whether this leapfrog moment becomes a lasting triumph or a missed opportunity for a just and sustainable energy future.