KHYBER Pakhtunkhwa (KP), endowed with abundant water resources, stands as Pakistan’s largest contributor to hydro-power generation. Paradoxically, however, while the national system reportedly has surplus capacity, consumers in KP continue to face unreliable supply due to weak transmission and distribution infra-structure, mounting circular debt, high line losses, illegal connections and systemic mismanagement.

To address these challenges, KP has developed its own power sector with a focus on reliability, efficiency and self-sufficiency in the shape of the Pakhtunkhwa Energy Development Organisation (Pedo) which has completed 10 public-sector hydropower projects, generating provincial revenue and employment.

Despite progress, structural constraints continue to hinder optimal usage. Disputes over net hydel profit arrears, limited inclusion of KP projects in federal gene-ration plans, high upfront costs, long gestation periods, and delays in transmi- ssion infrastructure have really undermined project viability.

KP has, however, pioneered electricity wheeling, allowing power to be supplied directly to industries. Since 2020, the 18MW Pehur project has provided cheaper and more reliable electricity to industries in the Gadoon Amazai Industrial Estate. In the next phase, 148MW from five hydropower projects will be wheeled to 74 bulk consumers, generating an estimated annual benefit of Rs788 million.

The province is also moving towards establishing its own distribution company, expanding transmission infrastructure and introducing a comprehensive energy regulatory framework for the province.

KP’s strategic importance is under-scored by its vast untapped hydropower potential, estimated at over 30,000MW, nearly half of Pakistan’s identified capacity. All four of Pakistan’s flagship hydropower projects under construction — Tarbela’s fifth extension, Mohmand Dam, Dasu and Diamer-Bhasha — are located in the province. If complemented by timely completion of these projects, strengthened grid infrastructure and regulatory reform, KP’s hydropower resources can become a durable pillar of Pakistan’s energy security.

With an installed capacity of 14,353MW, hydropower constitutes more than 30 per cent of the country’s total grid-connected power capacity. Its role remains critically central to energy security, environmental sustainability and overall economic stability, providing dependable baseload power amid existing and future fuel price volatility.

Hussain Ahmad Siddiqui
Islamabad

Published in Dawn, March 3rd, 2026