A new technical study released by the LUMS Energy Institute (LEI) concludes that Pakistan can transition to a clean and largely fossil-free electricity system by 2040 while maintaining affordability, reliability, and long-term energy security.

Titled ‘The Net Zero Transition: A Pathway to Clean and Sustainable Electricity by 2040’, the report is based on detailed power system modelling, demand projections, generation optimisation, and transmission analysis, making it one of the most comprehensive system studies undertaken on Pakistan’s electricity sector.

The analysis shows that share of fossil fuel generation, which currently accounts for nearly half of electricity generation, could effectively be reduced to below one percent by 2040 through renewable energy expansion, energy storage deployment, and grid modernisation. The transition pathway is projected to avoid approximately 78 million tons of carbon emissions, positioning the power sector as a central driver of Pakistan’s climate objectives.

One of the study’s most significant findings highlights how rapid growth in distributed solar generation is reshaping electricity demand profile. Daytime reliance on grid electricity is expected to fall sharply, with minimum system demand projected to decline to nearly 3,000 MW during certain periods despite rising overall consumption. This structural shift will require enhanced grid flexibility, optimal storage capacity, and demand-side management to maintain operational stability of the grid.

A 15-year roadmap outlined in the study provides a structured generation and transmission capacity expansion plan comprising approximately 8,500 MW of solar, 14,000 MW of wind, and 7,000 MW/ 42,000 MWh of battery energy storage, supported by grid reinforcement investments with a total estimated cost of USD 5.5 billion (present value: USD 1.9 billion). The modelling confirms that this transition pathway is technically viable and aligned with maintaining system reliability under high renewable penetration scenarios.

Importantly, the study shows that integrating indigenous renewable energy resources could substantially reduce dependence on imported fossil fuels, thereby enhancing long-term price stability and limiting exposure to global energy market volatility.

The report further highlights emerging investment opportunities in renewable generation, battery storage systems, and grid modernisation. As the power system evolves toward higher flexibility requirements, structured market mechanisms for grid stability services may become increasingly important, creating additional avenues for capital deployment beyond traditional energy generation assets.

Speaking at the launch, Ms. Shaista Pervaiz Malik, Member of the National Assembly and Convenor of the Parliamentary Task Force on Sustainable Development Goals (SDGs), appreciated the technical study undertaken by the LUMS Energy Institute and highlighted the importance of evidence-based policymaking in advancing Pakistan’s sustainable development agenda. She stated, “Pakistan’s transition toward clean and sustainable energy is closely linked with our national commitments under the Sustainable Development Goals. Analytical studies such as this help policymakers align grid modernisation, renewable expansion, and long-term planning with our energy security and decarbonization goals.”

Dr. Musadik Malik emphasized, Pakistan possesses abundant natural endowments, from hydropower and solar potential to vast wind corridors, yet the real pathway to a sustainable future lies in channeling these resources through sound policy and human ingenuity. Reports such as the one presented by the Energy Institute at the Lahore University of Management Sciences provide precisely the kind of evidence-based roadmap needed to guide Pakistan’s transition toward a stable, affordable, and ultimately net-zero transmission system.”

Dr. Fiaz Ahmad Chaudhry, Senior Advisor at the LUMS Energy Institute and Chairman BOD, National Grid Company, underscored the importance of integrated planning in shaping Pakistan’s energy future. “This report is not merely an academic exercise; it provides a practical blueprint for a sustainable and affordable energy future. It demonstrates through rigorous system analysis that decarbonisation, energy security, and economic efficiency can advance together through integrated planning and institutional coordination.”

The launch was attended by senior policymakers, representatives of regulatory institutions, and industry stakeholders, reflecting the growing national focus on research-driven planning to support Pakistan’s evolving energy transition.

The second Asia Energy Transition Summit, jointly organised by the LUMS Energy Institute (LEI), the Alliance for Climate Justice and Clean Energy (ACJCE) and the Pakistan Renewable Energy Coalition (PREC), concluded at LUMS on December 7. The two-day event brought together federal ministers, parliamentarians, civil servants, climate and energy experts and practitioners, academics and activists from across South Asia and Southeast Asia. The summit reaffirmed Asia’s growing political, financial and technological role in shaping regional and global trends towards a clean and just energy transition. It also emphasised the need for stronger regional cooperation and collaboration within Asia to expedite and smoothen this transition.

The Summit featured plenary sessions, keynote addresses and thematic discussions focused on advancing a just, people-centred, and affordable energy transition across Asia. Its key themes included new and sustainable pathways for financing energy transition and climatic adaptation and mitigation, tariff and non-tariff barriers to renewable-energy trade, distributed and utility-scale renewable deployment, flexible and climate-resilient grids, governance reforms and the risks posed by inequitable or technologically misdirected ‘false solutions’.

Delivering his keynote address during the summit, Prof. Ahsan Iqbal, Federal Minister for Planning, Development and Special Initiatives, highlighted the central role of energy transition in Pakistan’s future development. “Clean, reliable and affordable energy is essential for our economic revival,” he said. “By bringing together regional experts, Asia Energy Transition Summit has also helped Pakistan determine its role and contribution in shaping an Asia-wide fair, future-oriented energy agenda.”

Speaking at the closing plenary, Dr. Musadik Malik, Federal Minister for Climate Change and Environmental Coordination, highlighted the financing challenges that developing economies face, particularly in the energy and climate sectors. “The energy transition must ease the already heavy financial burdens on the developing states, not create new ones,” he noted. He also emphasised that as storage costs fall, batteries can address renewable variability and make energy transition smooth.

Nafeesa Shah, Co-Convener, Parliamentary Forum on Energy & Economy, said, “Parliamentarians and policymakers are the missing link in the energy transition and climate diplomacy discourse. It is essential that we promote global and Asia level collaborations for an effective and just energy transition.”

Addressing a townhall session on Pakistan’s power sector, Sardar Awais Ahmed Leghari, Federal Minister for Energy (Power Division), emphasised the urgent need to modernise the national grid to ensure a smooth and speedy energy transition. “Pakistan must build a flexible and a renewables-driven power system,” he said. “The insights shared during the Asia Energy Transition Summit will certainly guide power sector reforms within Pakistan and help it expand its solar and wind resources for power generation while also ensuring their equitable and affordable access to the citizens.”

Reflecting on the summit’s outcomes, Dr. Fiaz Ahmed Chaudhry, Chairman National Grid Company of Pakistan and Senior Advisor at LEI, highlighted Asia’s shared responsibility for energy transition and climate finance. “The summit brought together individuals and institutions who recognise sustainability, affordability and technical credibility as foundations for Asia’s energy future,” he stated. “I hope the discussions among them will generate partnerships that help countries in the region pursue technologically practical, environmentally appropriate, financially viable and socially just transition pathways.”

Concluding the Summit, Dr. Tariq Jadoon, Provost of LUMS, reaffirmed the University’s commitment to advancing research-driven, evidence-based energy policy, while Dr. Fiaz Chaudhry noted that the discussions will inform practical and financially viable pathways for countries aligning development agendas with climate and energy imperatives.

The Asia Energy Transition Summit 2025 concluded with renewed commitments from government, private sector stakeholders and international partners to work collaboratively toward a resilient, sustainable and equitable energy future, highlighting Asia’s critical role in driving the global energy transition.