By Azam Tariq

Cheaper daytime electricity tariffs could help Pakistan shift industrial consumption into solar-rich hours, boosting productive demand and improving grid utilisation while reducing the costly evening ramp that follows the decline in solar generation, energy-sector experts say.

The proposal is gaining relevance as electricity demand recovers but becomes increasingly uneven across the day. Central Power Purchasing Agency-Guaranteed (CPPA-G) data submitted to the National Electric Power Regulatory Authority (NEPRA) show that 15,122 GWh of electricity was generated in July 2026, up 7% year-on-year, while net electricity delivered to distribution companies rose about 6% to 14,501 GWh.

At the same time, growing rooftop solar is suppressing daytime grid demand, requiring conventional generation to operate at lower loads before ramping up when solar output declines in the evening.

The cost implications are significant. CPPA-G data show that RLNG-based generation averaged Rs47.38 per unit in July, while furnace-oil generation cost around Rs50.08 per unit, highlighting the expense of relying on thermal generation during periods when cheaper solar output is unavailable.

The policy debate has already reached the government. Power Minister Sardar Awais Ahmad Khan Leghari said in August that the government had been discussing time-based electricity tariffs with the International Monetary Fund for several months, including a proposed daytime marginal tariff of around Rs6 per unit to encourage consumption when electricity supply is abundant.

Experts say a similar approach could encourage factories and other flexible consumers to shift electricity-intensive operations towards the middle of the day.

Speaking to Wealth Pakistan, Muhammad Arif, former Member of the Oil and Gas Regulatory Authority (OGRA) and an energy policy and regulatory expert, said Pakistan’s energy challenge was increasingly linked to affordability, pricing and inefficient utilisation rather than simply a shortage of resources.

He said high electricity tariffs had encouraged consumers to move towards solar, reducing grid sales over which fixed system costs were recovered. Lower grid sales could then place additional upward pressure on tariffs, encouraging more consumers to reduce their dependence on the network.

Rather than discouraging solar, Arif proposed a “Sweet Hours” framework under which electricity prices would be reduced during periods of abundant daytime supply, particularly between 10 a.m. and 3 p.m., to encourage industries and other consumers to increase productive consumption.

“If electricity is abundant at noon, make it attractive to use electricity at noon rather than creating barriers,” he said.

Arif said lower daytime rates could encourage industries to schedule energy-intensive production during those hours, increasing grid sales and spreading fixed system costs over a larger volume of electricity.

The benefit would not be limited to households or businesses with rooftop solar, he said, as grid-connected consumers without their own generation could also take advantage of lower daytime tariffs.

Such pricing would build on an existing concept in Pakistan’s tariff structure. NEPRA already applies time-of-use tariffs to several consumer categories, including larger industrial and bulk consumers, with separate peak and off-peak rates. The policy question is whether those price signals can be redesigned to reflect the growing availability of low-cost daytime electricity.

Usama Usman, Research Associate – Power Systems at the Policy Research Institute for Equitable Development (PRIED), told Wealth Pakistan that cheaper daytime electricity could provide a demand-side complement to battery energy storage systems in managing the mismatch between solar generation and consumption.

He said battery energy storage systems remained relatively expensive, while appropriately designed daytime tariffs could encourage industries to shift more production towards hours when electricity was more readily available.

Muhammad Adeel Khalid, Senior Sales Manager at Inverex and former branch manager at K-Electric, told Wealth Pakistan that the proposal was industry-friendly but would require careful technical implementation.

He said appropriate metering, grid arrangements and potentially network upgrades would be needed to ensure consumers could respond reliably to different tariff periods.

Khalid said industries would have a strong economic incentive to maximise production during lower-priced daytime hours if the tariff differential was large, transparent and predictable.

Experts cautioned that cheaper daytime pricing would not eliminate the need for storage or flexible thermal generation because evening demand would still have to be met after solar output declined.

They argued, however, that shifting part of industrial consumption into solar-rich hours could reduce the size of the daytime-evening mismatch, improve utilisation of existing grid assets and convert abundant daytime electricity into additional industrial output rather than allowing it to become an operational burden.

Credit: INP-WealthPk