ISLAMABAD: Pakistan’s climate-related losses could reach up to 6 percent of GDP by 2050 if urgent action is not taken, as the country— already among the top five most climate-vulnerable nations— faces intensifying floods, heat waves, and water scarcity, according to a study by the Competition Commission of Pakistan (CCP).
The CCP study, titled “Unlocking Green Potential: A Market Competition Study of Solar Energy in Pakistan,” underscores the urgent need to shift toward environmentally sustainable power generation, particularly solar energy, which remains significantly underutilised despite the country’s vast potential.
The report highlights that Pakistan’s solar potential offers one of the most viable pathways to reduce environmental risks while supporting sustainable economic growth.
READ MORE: Solar energy sector: CCP flags gaps, inefficiencies hindering investment
However, despite a surge in solar imports and installations in recent years, solar energy contributes only around 2 percent of total electricity generation— revealing a stark mismatch between potential and actual utilisation.
While Pakistan benefits from abundant sunlight, especially in regions such as Balochistan and Sindh, the transition toward solar energy remains fragmented and constrained by structural and policy gaps.
The continued dominance of fossil fuels in the energy mix is not only driving up electricity costs but also contributing to rising greenhouse gas emissions and environmental degradation. Without a decisive shift toward clean energy, the study warns, Pakistan’s exposure to climate shocks will intensify, with significant economic and social consequences.
At the same time, solar adoption is accelerating, largely driven by rising electricity tariffs and unreliable grid supply. However, much of this expansion is taking place outside the formal system, limiting its contribution to national energy planning and environmental outcomes.
The CCP emphasises that solar energy presents a unique opportunity for Pakistan to simultaneously reduce emissions, lower energy costs, and enhance energy security. Scaling up solar deployment, the report notes, is no longer optional but essential for building climate resilience and ensuring long-term sustainability.
The study also identifies significant untapped potential in rural and agricultural sectors where solar solutions could reduce reliance on inefficient energy sources. It could also cut emissions, and provide reliable power to underserved communities. In particular, solarisation of agriculture could ease pressure on the power sector while improving productivity and reducing costs.
However, the report cautions that without a coherent policy framework, improved grid infrastructure, and stronger market mechanisms, Pakistan risks missing this critical opportunity. Structural challenges—including weak transmission and distribution systems, policy uncertainty, and financial constraints—continue to hinder large-scale adoption.
The CCP concludes that a well-coordinated transition to solar energy, supported by clear policies and competitive markets, can play a transformative role in mitigating climate risks and steering Pakistan toward a cleaner, more sustainable future.
Copyright Business Recorder, 2026
Comments
Comments are closed for this article.