Pakistan’s electricity market is developing a sharp divide between daylight and darkness. Between April and August 2026, the average hourly marginal price stood at Rs34.7 per kWh, more than double the Rs16.6 recorded in the corresponding period last year. But the monthly average tells only part of the story. By August, electricity was available at around Rs7.6 per unit during the middle of the day, while overnight prices averaged Rs49.1.
The shift is striking. For much of 2025, marginal prices followed a familiar pattern, easing around midday before rising into the evening. The gap between the cheapest and most expensive hours was noticeable but manageable, typically Rs14 to Rs21 per unit in summer. By August 2025, the midday trough had already fallen to around Rs7, but prices outside those hours remained relatively subdued.
The annual averages barely hinted at what was coming. The average marginal price rose from Rs17.7 per unit in FY25 to Rs20.8 in FY26, an increase of 18 percent. Then came April 2026. The monthly average surged from Rs16.3 in March to Rs40.2 in April, with even the cheapest hour, around noon, costing Rs23.9 per unit. The evening peak touched Rs50.2 at 6pm.
Prices moderated in May and June, but the midday floor remained elevated through July. The more consequential change, however, emerged in August, when the market split into two distinct price regimes.
Between 10am and 1pm, the average marginal price was Rs7.6 per unit, almost unchanged from Rs7.1 a year earlier. Between 5pm and 10pm, it averaged Rs46.6. Overnight, from 10pm to 6am, the average reached Rs49.1, with the peak touching Rs51.7 at 11pm.
In other words, the cheapest hours barely moved, while prices outside the daylight window surged. The gap between the cheapest and most expensive hours widened from Rs14.3 in August 2025 to Rs44.4 in August 2026.
The pattern is consistent with the growing influence of solar generation. Abundant daytime supply can push the marginal price towards the lower end, while the withdrawal of solar generation leaves evening and night demand to be met by costlier sources. The hourly price data alone cannot establish which plants set the marginal price or how much of the shift reflects fuel costs, demand patterns or dispatch decisions. That requires corroboration from generation and dispatch data. But the widening intraday spread is difficult to ignore.
For industrial consumers, the implications are immediate. Businesses able to shift flexible loads towards the late morning and early afternoon could benefit from substantially lower marginal prices than those operating through the evening and night. Those with continuous operations, however, remain exposed to the expensive hours.
The spread also strengthens the case for examining storage economics. Charging batteries during low-price hours and discharging during the evening peak could capture a sizeable gross price differential. But the spread is not the same as a bankable return. Round-trip efficiency losses, battery degradation, capital costs, taxes, network charges and the applicable tariff structure will determine whether storage makes commercial sense.
Tariff design is another consideration. When the underlying marginal price varies so sharply across the day, a single average tariff can obscure the cost of consumption at different times. Time-of-use pricing could provide a stronger incentive to shift demand towards cheaper hours, provided the tariff structure reflects the actual cost of supply and gives consumers enough flexibility to respond.
Winter will provide the next test. Historically, the daily price curve flattened during the colder months, with February spreads of roughly Rs2 to Rs6 per unit. January 2026, however, already showed some divergence, with evening prices reaching Rs32.7 against Rs25.8 around midday and a peak at 7pm.
If the August pattern persists into winter, the pressure on evening prices could become a more enduring feature of the market rather than a seasonal anomaly. That would have implications for industrial competitiveness, battery investment and the way electricity tariffs are structured.
Pakistan’s power market is not simply becoming more expensive. It is becoming increasingly differentiated by the hour. The challenge now is to align consumption, storage and tariff design with a market in which the price of electricity can change dramatically between noon and night.