Pakistan proposes Rs91 billion for Power Sector Development in FY 2026-27
The federal government has proposed Rs91 billion for the Power Division in the FY 2026-27 PSDP, with most funding for ongoing schemes.
Intelligence analysis by GPT-5.4 Mini
Islamabad has proposed a Rs91 billion PSDP allocation for the Power Division, including money for ongoing projects, new schemes, grid upgrades, and transmission work tied to major hydropower and interconnection projects.
Pakistan is planning to spend money on its power system, like fixing roads for electricity to travel on. The plan includes batteries, grid stations, and wires so electricity can move more safely and steadily to homes and factories.
Analysis
What is being proposed
The federal government has proposed Rs91 billion for the Power Division under the Public Sector Development Programme for the upcoming fiscal year. Of that amount, Rs86 billion is set aside for ongoing projects, while more than Rs4 billion is proposed for new development schemes.
Main priorities
A major new item is a Battery Energy Storage System (BESS) for frequency regulation, for which over Rs3 billion has been proposed next year. The project’s total estimated cost is Rs112 billion, making it one of the bigger long-term power-sector investments mentioned in the article.
The budget proposals also include funding for several transmission and distribution projects. These include Rs2.91 billion for improving SEPCO’s power distribution network, Rs3.9 billion for transmitting electricity from Mohmand Dam, and Rs10.83 billion for Phase-I of the Dasu Hydropower Project transmission scheme. The government has also suggested Rs5.11 billion for the CASA-1000 Interconnection Project and Rs3 billion for the transmission project linked to the Suki Kinari Hydropower Project.
Grid infrastructure upgrades
The National Transmission and Despatch Company (NTDC) is expected to receive Rs3.5 billion for upgrades to its telecommunications and SCADA systems. Another notable allocation is Rs9.38 billion for the Islamabad West Grid Station project.
Taken together, the proposed spending points to continued emphasis on generation-linked transmission, grid modernization, and distribution improvements across the country.
Key points
- The federal government has proposed Rs91 billion for the Power Division in PSDP 2026-27.
- Rs86 billion is earmarked for ongoing projects and more than Rs4 billion for new schemes.
- Over Rs3 billion is proposed for a battery energy storage system for frequency regulation.
- Major allocations include funding for SEPCO, Dasu transmission, CASA-1000, and Suki Kinari transmission.
- NTDC and the Islamabad West Grid Station project also receive proposed funding.
If the allocations are approved and delivered on time, Pakistan could improve grid stability, reduce bottlenecks, and make room for new power coming from hydropower and interconnection projects. The battery storage plan could also help smooth out fluctuations in the electricity system.
If projects move slowly or face implementation problems, the money may not translate into better service on the ground. Large transmission and grid upgrades can also face delays, which would limit the impact of the proposed spending in the near term.
