PM Shehbaz Approves $17 Billion Power Sector Overhaul with 10-Year IGCEP Plan

On May 20, 2025, Prime Minister Shehbaz Sharif approved the Integrated Generation Capacity Expansion Plan (IGCEP) 2024–34, a comprehensive 10-year roadmap aimed at reforming Pakistan’s power sector. The plan is projected to save approximately $17 billion by rescheduling and canceling 7,967 megawatts (MW) of planned projects, focusing on cost-efficiency and sustainability.

Key Highlights of the IGCEP 2024–34:

• Project Optimization: The plan reduces the originally proposed 14,984 MW of new projects to 7,017 MW, emphasizing strategic hydropower initiatives like the Dasu and Mohmand Dams.
• Cost Savings: By adjusting project timelines, the strategy is expected to reduce the national economic burden by Rs 474.3 billion and yield savings of approximately $10 billion. An additional $7 billion in savings is projected by scrapping unnecessary projects.
• Tariff Reduction: The implementation of the IGCEP is anticipated to lower electricity tariffs, with estimated average savings of more than Rs 2 per unit for consumers.
• Renewable Energy Focus: The plan prioritizes projects based on indigenous resources—hydropower, solar, nuclear, and wind—to reduce dependency on imported fuels and save foreign exchange.

Government Directives and Oversight:

Prime Minister Shehbaz Sharif has instructed the Power Division to continue efforts to reduce electricity prices, eliminate circular debt, and control line losses and theft. He emphasized the promotion of renewable energy to protect the climate and conserve foreign exchange.

A high-level committee has been constituted to oversee reforms in the petroleum sector, aiming to synchronize LNG demand with the power sector’s requirements and address issues related to circular debt and tariffs in the gas sector.

Conclusion:

The approval of the IGCEP 2024–34 marks a significant step towards achieving a sustainable and cost-effective power sector in Pakistan. By focusing on indigenous resources and eliminating unnecessary projects, the plan aims to provide affordable and reliable electricity to consumers while ensuring economic stability.

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