Government Aims to Save Billions Through Energy Project Revisions

The government plans to achieve savings of Rs4,743 billion (USD17 billion) by removing 7,967MW of expensive energy ventures and modifying project timelines under the forthcoming Indicative Generation Capacity Expansion Plan (IGCEP) 2024-2034, the Prime Minister’s Office (PMO) announced.

According to a statement released by the PMO, the decision emerged from a meeting presided over by Prime Minister Shehbaz Sharif in Islamabad. The discussions centered on lowering electricity costs and enacting enduring reforms within the energy sector, with a significant focus on the IGCEP.

The government intends to prioritize domestic resources and alternative energy options such as solar, nuclear, and hydropower over imported fuels under the IGCEP. This shift is anticipated to save Pakistan several billion dollars in foreign exchange reserves.

The administration also intends to gradually eliminate capacity payments to power generation firms, the statement further noted.

During the meeting, Shehbaz Sharif remarked that following a recent electricity rate reduction of approximately Rs7.50 per unit, the government remains dedicated to implementing an effective strategy for lasting energy sector improvements to provide further relief to the populace.

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The prime minister instructed the relevant authorities to accelerate the completion of essential projects, including the Diamer Bhasha Dam, to guarantee efficient systems for energy production and water conservation across the nation.

Timely Completion of Projects Emphasized

“Any postponement in the finalization of energy projects is unacceptable,” he stressed.

The prime minister also revealed that a free market for electricity generation will be established soon. “The establishment of this market will facilitate competitive power supply, resulting in more sustainable electricity availability and additional tariff reductions,” Shehbaz Sharif stated in the announcement.

The prime minister received a briefing on the ongoing reforms within the energy sector during the meeting.

Following the PM’s directive, a reassessment of the IGCEP identified opportunities for additional enhancements. Subsequently, the Task Force amended the plan to better reflect current conditions and future demands.

The briefing further explained that the IGCEP sets the stage for awarding power projects through competitive bidding and selling electricity at the lowest possible price for the next decade.

The meeting included attendance by Minister for Power Sardar Awais Leghari, Minister for Economic Affairs Ahad Khan Cheema, Minister for Information Attaullah Tarar, Minister for Petroleum Ali Pervaiz Malik, along with high-ranking officials from relevant organizations.