As solar energy takes over grid power by force, Pakistan is quickly becoming a nation that is getting quite fed up with traditional power. One might ask why, because not only is grid power not helping the environment, but the prices have become way too extreme for citizens to even pay. This adoption is primarily driven by market forces with minimal political support.
As grid power becomes more expensive, going up by 115% in just the past three years, solar panel prices have significantly declined. This has inevitably led Pakistani citizens to take up solar as a much more viable option as the country heads towards more renewable energy sources, making it now the sixth largest solar market in the world.
Although this shift is not at all political, China’s overproduction of solar panels has dropped rates, leading people to move towards solar themselves. With Pakistan being the third largest consumer of China’s exports, most residential individuals and corporations move towards making solar a primary source of energy, with modules at 13 gigawatts in the first half of the year and 22 gigawatts by the year’s end. With more consumers leaving the grid behind, people who are still using it are paying the price. Hence, renewable energy is emerging as a key beneficiary. Furthermore, inconsistent energy policies and tariff hikes have reduced grid electricity consumption by over 10% in the past year.
The unstable supply of state-owned energy providers and the national grid has been a constant barrier to economic growth. Pakistan’s per capita consumption has renewed by 87% from the years 2000 till 2022, with over 40 million people without access to electricity at all while more people lack clean cooking facilities. Many places around the country still operate with less than four hours of electricity on a daily basis. On the other hand, record-breaking heat waves have increased the demand for general cooling fans. Of course, due to the costs and unreliable performance of the traditional grid, 40–50% of industries are still relying on power plants despite being connected to the grid.
The government’s inconsistent energy policies, inefficient production, and regulations are worsening the current energy crisis. Electricity prices have increased since July 2024, which is seen as a form of taxation that has led to the lowest electricity grid in four rides, which dropped about 10% last year. The high tariffs have left businesses and households to rely on other sources of power.
Global rules like the EU’s Carbon Border Tax and net-zero goals from large brands have sped up the need for green energy. Export-driven industries must switch to renewable energy to stay competitive or risk losing business. Without access to renewable power, these companies are at a major disadvantage.
A growing solar energy shift is driven by cheaper batteries and the need for reliable power, pushing more people toward renewables. However, this rapid change risks overwhelming the traditional grid, where concerns are rising about its stability and economic impact. To handle this transition, Pakistan has to modernize its grid by investing in AI monitoring, battery storage, and smart meters. Without these updates, the grid faces a risk of financial collapse as more users move towards independent solar systems.
Currently, what Pakistan needs is strong political reform when it comes to its energy market. This can happen by privatizing and unbundling distribution companies. However, political instability and high costs can make this difficult. China’s involvement is complicated as it invests in thermal power and supplies most of Pakistan’s solar technology. Pakistan’s experience shows the need for better management of renewable energy in complex environments. Moving from a government-controlled energy model to a competitive market can lower tariffs, create new incombe for grid operators, and accelerate demand for grid services. Supporting solar adoption through credit for off-grid areas and encouraging battery use can further integrate renewables and improve power quality.
