Pakistan’s power purchase cost is projected to reach Rs3.55 trillion in 2027, with the average price of electricity purchased by distribution companies estimated at Rs27.309 per unit under the base-case scenario.
The forecast has been prepared by the Central Power Purchasing Agency Guarantee Limited (CPPA-G) as part of the rebasing of consumer-end electricity tariffs for former WAPDA distribution companies (XWDISCOs), scheduled to take effect from January 1, 2027.
The projections will come under review by the National Electric Power Regulatory Authority (NEPRA), which has scheduled a public hearing for November 3 at 2pm. The hearing will take place at NEPRA Tower and online through Zoom.
Consumers, businesses and other interested parties can submit their comments or objections, either in writing or verbally, before or during the hearing, according to a notice issued by the regulator.
The estimated cost could vary significantly depending on economic conditions and electricity demand. Under six scenarios assessed by the CPPA-G, the projected power purchase price ranges from Rs25.883 per unit in the ideal case to Rs29.255 per unit in the second-worst case.
The base-case estimate assumes electricity demand will grow by 2.60 percent in 2027, with the exchange rate remaining at Rs279 against the US dollar. Under these assumptions, distribution companies are expected to purchase 130,081 gigawatt-hours (GWh) of electricity.
Capacity charges account for the largest share of the projected bill, estimated at Rs1.91 trillion, or Rs14.717 per unit. These payments cover the cost of maintaining available power generation capacity, rather than simply the electricity actually produced.
Fuel costs are projected at Rs1.32 trillion, equivalent to Rs10.141 per unit. Another Rs70.58 billion is allocated to variable operation and maintenance costs, while transmission-related expenses and charges linked to the Ministry of Finance are estimated at Rs248.30 billion, or Rs1.909 per unit.
The projections also show how a weaker rupee or slower growth in electricity demand could affect the final cost.
In the worst-case scenarios, the exchange rate is assumed to reach Rs290 against the dollar, compared with Rs279 in the other cases. A separate demand-sensitivity scenario assumes growth of just 0.70 percent, reducing electricity sales to distribution companies to 127,937 GWh.
The CPPA-G has kept several other economic assumptions unchanged across all six scenarios. These include the Karachi Interbank Offered Rate (KIBOR) at 11.70 percent, the Secured Overnight Financing Rate (SOFR) at 3.98 percent, US inflation at 2.10 percent and domestic inflation at 8.20 percent. National Grid Company (NGC) losses have been assumed at 2.50 percent.
The proposed power purchase price is a key input in determining electricity tariffs for consumers. However, the final impact on bills will depend on the outcome of the regulatory process and the applicable tariff structure.
NEPRA said the issues framed for the hearing, along with a copy of the CPPA-G’s forecast, can be obtained from its office or website. The hearing will give stakeholders an opportunity to raise concerns and present their views before the regulator considers the projections.
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