ISLAMABAD: The Pakistan Textile Exporters Association (PTEA) has proposed amendments to the three-year power incremental package for the industrial and agriculture sectors. The package has been designed to utilize idle generation capacity and extend relief to key segments of the economy.
However, industry representatives have flagged several concerns, while Nepra has also questioned why the Power Division did not consult industrial consumers — the main beneficiaries — before the package was approved by the federal cabinet.
In a letter to Minister for Power Sardar Awais Ahmad Khan Leghari, PTEA Patron-in-Chief Khurram Mukhtar pointed out multiple anomalies that may unintentionally undermine the core purpose of the initiative.
Mukhtar argued that the load factor requirement must not exceed 40 percent, emphasizing that spinning, weaving, processing and other continuous-process sectors should be able to participate meaningfully. Allowing broader participation, he said, is essential for the Power Division’s goal of increasing electricity demand and reducing capacity payments.
He noted that these sectors operate round-the-clock, are highly energy-intensive and provide a steady, predictable load that enhances grid stability.
“Because of this continuous operation, they naturally maintain higher load factors and are among the most reliable and system-friendly consumers. Any eligibility criteria that ignore these operational realities will exclude precisely those industries that stabilize the grid and provide consistent revenue to DISCOs,” he stated.
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The PTEA highlighted that Pakistan’s total industrial sanctioned load is 19,810 MW, which theoretically requires 19,810 MW × 8,784 hours = 174,015 GWh. However, NEPRA’s State of Industry Report 2024 shows actual industrial consumption in FY24 at only 22,532 GWh.
According to the PTEA, the implied load factor—based on sanctioned load and billed units—drops to 13 percent, demonstrating that sanctioned-load-based metrics do not reflect real industrial demand patterns. Even NEPRA’s indicative 60 percent industrial load factor “does not match reality,” the association said.
Mukhtar noted that if the 60 percent load factor were applied, 19,810 MW × 8,784 hours × 60 percent = 104,409 GWh, this figure is 4.5 times higher than actual industrial consumption, underscoring the gap between theoretical and actual usage.
PTEA identified several reasons why sanctioned load distorts calculations: (i) sanctioned load is often higher than actual demand, taken as a buffer for expansion; (ii) many industries operate far below their sanctioned levels; and (iii) seasonal patterns, economic cycles, load-shedding and order variability decrease actual consumption.
Therefore, sanctioned-load-based calculations overestimate expected demand and produce unrealistic eligibility thresholds.
The PTEA concluded that the proposed 60 percent load factor requirement is unachievable for the overwhelming majority of industries and urged a more “realistic, equitable and technically sound” benchmark.
Mukhtar stressed that the load-factor requirement must not exceed 40 percent, aligned with operational realities while still promoting sustained demand growth.
The Association also criticised the use of a single-year reference period (Dec 2023–Nov 2024), arguing that it does not reflect true consumption patterns, which fluctuate due to: (i) energy shortages; (ii) grid instability; (iii) economic slowdowns; and (iv) order-book variations.
Mukhtar said that using a three-year average would be more equitable and representative, expand eligibility and better support the Federal Government’s objective of maximizing industrial load growth.
Copyright Business Recorder, 2025
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