The more one writes about Pakistan’s energy sector mess, the less it seems to cover. The latest issue involves the government’s commitment to the IMF to end captive power generation by January 2025. This decision was made hastily, without thorough consideration, and now there are conflicting views within the energy ministry, with the power and petroleum divisions working at cross-purposes.

These two branches operate in silos, focusing on their own interests, while national priorities are compromised in a tug of war. This is precisely why a unified energy ministry is essential to ensure a single, cohesive national energy policy.

The power division wants industrial captive users to shift to the national grid to increase demand, which is currently declining. This would help dilute the capacity charge per unit. On the other hand, gas utility companies prefer to retain high-paying customers who use expensive RLNG (Re-gasified Liquefied Natural Gas), as this cross-subsidizes domestic consumers. If captive power ends, excess RLNG usage will become an even bigger issue, potentially raising costs for domestic consumers and worsening the gas circular debt.

Industries, meanwhile, prefer to retain captive power since some use combined heat and power (CHP)........

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