For more than a century, electricity systems have been built around a simple proposition: a handful of large power stations generate electricity, transmission networks carry it across the country and consumers passively receive it. That architecture powered industrialisation, but it belongs to another era.
The next revolution in electricity will not be driven by larger power stations; it will be driven by intelligence.
Pakistan has arrived at this turning point almost by accident. Faced with soaring tariffs and unreliable supply, households and businesses invested massively in rooftop solar without waiting for government programmes.
In doing so, they created one of the largest distributed solar markets in the developing world. Yet our policy debate remains trapped in questions of net metering, tariffs and utility revenues instead of asking the far more important question: what should Pakistan’s electricity system look like twenty years from now?
The answer is beginning to emerge internationally. The World Economic Forum recently identified ‘Everything-to-Grid (X2G) Energy’ as one of its Top 10 Emerging Technologies of 2026.
The idea is both simple and revolutionary. Instead of viewing electricity consumers as passive users of power, every energy asset becomes an active participant in the electricity system.
Rooftop solar, batteries, electric vehicles, commercial buildings, factories, agricultural pumps and flexible industrial loads are digitally connected so they can generate, store, consume or return electricity whenever the system needs them.
The grid evolves from a network of wires into an intelligent digital platform coordinating millions of assets in real time.
That vision has profound implications for Pakistan. The country has already accumulated many of these distributed assets. What it lacks is the digital architecture, market design and storage needed to turn them into a coherent national resource.
The challenge is therefore no longer to build generation alone, but to orchestrate what already exists.
This also changes the role of Multilateral Development Banks. For decades, success has been measured by the number of power stations, dams and transmission lines financed. That approach reflected the needs of a centralised electricity system. It is no longer sufficient. If the future grid is an intelligent platform, development finance must increasingly support platforms rather than projects.
Investments should prioritise battery storage, advanced metering, communications infrastructure, artificial intelligence, cybersecurity, virtual power plants and electricity markets that coordinate distributed resources.
Storage deserves particular attention because it has become Pakistan’s most critical infrastructure requirement.
Every unit of storage increases the value of every solar panel already installed by shifting inexpensive daytime electricity to evening demand. It reduces curtailment, strengthens grid stability, lowers balancing costs and reduces dependence on imported fuels. Without adequate storage, additional renewable generation produces diminishing returns because the system cannot use it efficiently when it is available.
This does not mean large infrastructure projects have become obsolete. Pakistan will continue to require major hydropower projects, efficient thermal capacity and utility-scale renewable generation. Their strategic role, however, is changing.
Instead of carrying the daily burden of balancing the grid, they should increasingly provide reserve and backstop capacity while storage, flexible demand and distributed resources manage normal system operation.
Equally important, Pakistan’s institutional architecture must evolve. Reforms such as the Competitive Trading Bilateral Contract Market represent worthwhile progress, but they remain rooted in a market designed for a relatively small number of generators and buyers.
The electricity system now emerging may involve millions of active participants. Existing institutions—including regulators, market operators and planning bodies—were designed for one-way power flows and centralised generation.
The issue is not institutional competence; it is institutional fit. Every technological revolution eventually requires new market rules, new institutions and a new strategic vision.
Pakistan should therefore present its next phase of reform around a National Intelligent Energy Platform rather than another collection of generation projects.
Such a programme would integrate storage, digital infrastructure, flexible markets, virtual power plants and local manufacturing into a single national mission. It would also provide a compelling framework for engagement with the World Bank, ADB, AIIB and climate funds by focusing on the transformation of the entire electricity system rather than isolated assets.
The countries that lead the next phase of the energy transition will not necessarily be those that build the largest solar parks. They will be those that build the most intelligent electricity systems.
Pakistan already possesses much of the physical foundation. The next step is to connect those assets through storage, digital technologies and modern market design. If we succeed, Pakistan can move from reacting to the global energy transition to helping define it.
Copyright Business Recorder, 2026