K-Electric, the primary power utility for Karachi, is facing a severe financial crisis that threatens the city’s power supply infrastructure, experiencing a total liquidity drain of 65 billion rupees as commercial banks halt new financing, withdraw 30 billion rupees in existing funds, and suspend 35 billion rupees worth of Islamic bonds. This crisis is primarily driven by tariff uncertainty and delays, highlighted by a delayed NEPRA tariff notification for the 2024–2030 control period that was abruptly reduced from 38–39 PKR to 32 PKR per unit via a suo motu notice—a revision currently challenged before the NEPRA Tribunal. Consequently, capital shortages have forced KE to restrict operations primarily to emergency maintenance, freezing procurement and causing delays in publishing financial statements for FY2024, FY2025, and FY2026. Financial expert Samiullah Tariq notes that KE has flipped from an annual profit of 4 billion rupees to a staggering loss exceeding 80 billion rupees, pointing out that a viable break-even tariff requires a rate of 37 to 38 PKR per unit. Ultimately, industry experts warn that these unaddressed cash-flow constraints will directly compromise transmission lines and distribution networks, putting Karachi’s uninterrupted power supply at serious risk.
