ISLAMABAD: The government on Thursday launched a nationwide energy efficiency initiative, the “Prime Minister’s Fan Replacement Programme,” aimed at replacing 100 million conventional fans with energy-efficient models. It also signalled plans for debt restructuring in the power sector as part of what Federal Minister for Power Awais Leghari described as “painful but necessary” structural reforms.
Addressing the launching ceremony, Leghari said Prime Minister Shehbaz Sharif, the cabinet and relevant institutions were aligned on the reform agenda and determined to implement structural changes regardless of the political cost. He also said that government is thinking of debt restructuring of the sector as well.
“We have undertaken very painful reforms and will continue to do so. Whether the reforms are easy or difficult, they will be implemented,” he said, adding that broader financial restructuring options were also under consideration to stabilize the sector.
READ MORE: USD 3.5bn financing needed to replace ‘inefficient’ fans in Pakistan
The minister said electricity demand had declined to around 8,000 megawatts at certain times, attributing the trend partly to rapid solarisation driven by previously high tariffs. He said increased solar penetration had created operational challenges for the national grid.
“Due to lower demand, power plants are being run only for a few hours in line with consumption. However, these plants have to be maintained throughout the year,” he said.
Leghari said that on the prime minister’s directives, the Power Division would approach the National Electric Power Regulatory Authority (NEPRA) regarding net metering. He clarified that existing net metering consumers would continue under the current regime.
The minister claimed that electricity prices had been reduced by up to 20 percent over the past 18 to 20 months. He said protected consumers had received relief of 35 to 40 percent, while industrial tariffs had been reduced by 35 percent to around 11.5 cents per unit during the last two years.
He added that replacing inefficient fans with energy-saving models would reduce overall electricity consumption, ease pressure on the grid and minimize the need for additional generation capacity.
Under the programme, consumers will be able to replace their old fans with energy-efficient ones. He said a charge of around Rs1,000 would apply, while the earlier requirement of mandatory return or buyback of old fans has been withdrawn.
He encouraged citizens to participate in the Fan Replacement Program and take full advantage of easy terms and conditions of the initiative. Leghari said replacing old, traditional fans with energy-efficient models will help mitigate the issue of peak-hour electricity usage, lower the country’s carbon footprint, and help individuals save money on their bills.
Leghari expressed government’s commitment to transforming Pakistan into a competitive energy market through various long-term and short-term reforms. He highlighted that clean energy accounted for fifty-five percent of the country’s power this year, with a goal to reach ninety percent by 2034.
Minister for Climate Change Musadik Malik termed the initiative a milestone in the energy sector and said it would provide relief to consumers facing high electricity bills. He said each household could save up to Rs12,000 per fan annually by switching to efficient models.
Malik while welcoming its rollout within 90 days, said the program aligns with the Prime Minister’s policy focus on providing relief to the poor.
“Everyone is criticizing electricity bills. This program is crucial to provide relief,” Malik said, adding that the broader climate and economic benefits of the initiative, linking energy reforms to the country’s vulnerability to climate disasters. Malik noted that in the past four to five floods, nearly 6,000 people had lost their lives, around 40 million people were affected, and 20 million children were displaced.
“Flood-related losses amount to nearly 9.8 percent of GDP. Who will compensate for the loss of education and livelihoods?” he questioned, adding that 1.8 billion school days had been lost due to climate-related disasters.
Malik said the fan replacement program would not only reduce electricity bills but also help prevent economic losses equivalent to up to 10 percent of GDP caused by climate impacts.
Managing Director of NECA Humayoun Khan said the programme would help reduce electricity consumption significantly and support stability of the national grid. He said the initiative is part of broader efforts to promote energy conservation, reduce electricity costs and improve sustainability of the power sector.
Federal Minister for Finance and Revenue, Muhammad Aurangzeb issued a statement while reaffirming the Ministry of Finance’s full commitment to supporting the Prime Minister’s Fan Replacement Program, describing it as a critical initiative for energy conservation, fiscal responsibility, and climate action.
The Finance Minister emphasized that from the perspective of the Ministry of Finance, the initiative remains a high priority, and the Ministry will continue to provide all necessary support to the Power Division to ensure its successful implementation and rapid scaling.
Highlighting the Ministry’s role, Aurangzeb stated that the Ministry of Finance has allocated Rs 2 billion in the budget as a 10 percent first-loss risk guarantee. This facility is designed to encourage banking institutions to actively participate in the program by mitigating initial credit risk and facilitating financing for consumers seeking fan replacement.
He further shared that although the program was formally launched today, a pilot phase has already been conducted in collaboration with the State Bank of Pakistan and the banking sector. The proof of concept has been successfully established, with 11 banks participating in the pilot. During this phase, approximately 186 energy-efficient fans have already been installed, with disbursements of around PKR 1.35 million benefiting 67 borrowers. Describing this as an encouraging beginning, the Finance Minister noted that the digital enablement systems, financing mechanism, and disbursement processes are now operational and functioning effectively.
He acknowledged the leadership of Federal Minister for Power, Awais Leghari, in driving the initiative forward and stated that the next phase will focus on rapidly scaling up the program in coordination with the State Bank and commercial banks. The objective, he said, is to accelerate implementation so that the program’s benefits can be realized sooner rather than over an extended 10-year horizon.
The Finance Minister reiterated that the Ministry of Finance will continue to extend full support in advancing energy conservation goals, strengthening fiscal sustainability, and contributing to Pakistan’s broader climate change agenda.
Copyright Business Recorder, 2026
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