Power purchase price projected at Rs 27.309 per unit for 2027

• CPPA-G estimates electricity procurement costs at Rs 3.55 trillion under its base-case scenario.
• Capacity payments make up the largest component, at Rs1.91 trillion or Rs 14.717 per unit.
• NEPRA will hold a public hearing on November 3 ahead of tariff rebasing planned for January 2027.

Pakistan’s electricity purchase price is projected at Rs 27.309 per kilowatt-hour (kWh) in 2027, according to estimates submitted by the Central Power Purchasing Agency-Guarantee Limited (CPPA-G), with total procurement expenditure expected to reach Rs 3.55 trillion under its base-case scenario.

The estimates form part of the planned rebasing of consumer-end electricity tariffs for ex-Wapda distribution companies (XWDISCOs), scheduled to take effect on January 1, 2027, The News reported. They will help establish the reference costs used to calculate tariffs for the new period.

The projected purchase price is separate from the final rate charged to consumers. Retail electricity tariffs will depend on the National Electric Power Regulatory Authority’s (NEPRA) determinations, along with applicable taxes, duties, subsidies and other components.

NEPRA has scheduled a public hearing on the projections for November 3, 2026, at 2pm at NEPRA Tower. Interested and affected parties have been invited to submit comments and objections, while stakeholders can also attend through Zoom.

In its base-case calculations, CPPA-G has assumed annual electricity demand growth of 2.60%, an exchange rate of Rs279 to the US dollar and electricity sales of 130,081 gigawatt-hours (GWh) to distribution companies.

Capacity payments represent the biggest share of the estimated expenditure, amounting to Rs1.91 trillion, or Rs14.717 per unit. Fuel expenses are projected at Rs1.32 trillion, equivalent to Rs10.141 per unit.

Variable operation and maintenance costs are estimated at Rs70.58 billion, or Rs0.543 per unit. Transmission-related expenditure and charges payable to the Ministry of Finance together account for another Rs248.30 billion, translating into Rs1.909 per unit.

CPPA-G has presented six scenarios to assess how changes in demand, fuel costs, exchange rates and capacity payments could affect electricity procurement prices. The estimates range from Rs25.883 per unit under the ideal scenario to Rs29.255 per unit under Worst Case-II.

Both worst-case scenarios assume the rupee weakens to Rs290 against the US dollar, compared with Rs279 in the remaining scenarios. The projected purchase price stands at Rs28.835 per unit under Worst Case-I and Rs29.255 under Worst Case-II.

A separate demand-sensitivity scenario assumes electricity demand grows by only 0.70%, reducing projected sales to 127,937 GWh. Under these assumptions, the purchase price reaches Rs27.568 per unit, reflecting lower sales volumes and revised capacity-cost estimates.

Another scenario assessing the mix of re-gasified liquefied natural gas (RLNG) and gas places the purchase price at Rs26.441 per unit. The ideal scenario produces the lowest estimate of Rs25.883 per unit, mainly because of lower fuel expenses.

All six scenarios use a Karachi Interbank Offered Rate (KIBOR) of 11.70%, a Secured Overnight Financing Rate (SOFR) of 3.98%, US inflation of 2.10% and domestic inflation of 8.20%. They also assume National Grid Company (NGC) losses of 2.50%.

The estimates remain subject to regulatory review. At the November 3 hearing, stakeholders will be able to challenge the assumptions and expenditure projections submitted for the tariff rebasing exercise.