World Bank mission in Pakistan to discuss plan to improve power stability system

Two perosns walk by the building of the Washington-based global development lender, The World Bank Group, in Washington on January 17, 2019. (AFP/File)
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Updated 27 January 2025
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World Bank mission in Pakistan to discuss plan to improve power stability system

  • World Bank mission to advance preparations for systems that manage, improve quality of power in electrical grids
  • Pakistan has taken steps recently to reform its energy sector, lower electricity costs and reduce transmission losses

ISLAMABAD: A World Bank mission is in Pakistan to discuss a plan to improve the power stability system in the energy-starved South Asian country, a spokesperson of the financial institution confirmed on Monday. 

As per local media reports, the World Bank mission was due to arrive in Pakistan on Monday for a two-day visit to develop a work plan and agree on the next steps to advance the preparation of Reactive Compensation Devices. 

Reactive Compensation Devices are electrical systems used to manage and improve the quality of power in electrical grids by controlling the flow of reactive power.

“There is a mission in town. That’s all I can confirm at this point,” Maryam Altaf, the communications officer at the World Bank’s Pakistan office, told Arab News when asked to confirm reports. 

Pakistan has been eagerly attempting to reform its energy sector, lower electricity costs and reduce transmission losses in its bid to curtail its mounting circular debt.

Prime Minister Shehbaz Sharif’s government has increasingly spoken about its desire to reduce electricity theft and transmission losses through energy sector reforms. This has resulted in the country suffering long hours of power outages, especially during summers, and suffering huge economic losses as a result. 

Earlier this month, the federal cabinet approved a plan to renegotiate agreements with 14 independent power producers (IPPs). The government said the revised agreements with the IPPs would cause a reduction of Rs802 billion ($2.9 billion) in costs and profits, including a Rs35 billion ($126 million) cut in past excess profits. 

At the core of Pakistan’s energy problems are capacity charges, or payments made to IPPs regardless of electricity consumption, which have exacerbated Pakistan’s circular debt, now exceeding Rs2.4 trillion ($8.6 billion), as per energy minister Sardar Awais Ahmad Laghari.

Laghari also announced earlier this month that the government will implement a new energy market system through which consumers will be able to buy power from multiple suppliers starting March. 


Pakistan, UK sign £35 million Green Compact to strengthen climate resilience

Updated 21 December 2025
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Pakistan, UK sign £35 million Green Compact to strengthen climate resilience

  • Pakistan ranks among nations most vulnerable to climate change and has seen erratic changes in its weather patterns
  • UK will help Pakistan mobilize climate finance, strengthen regulatory frameworks and develop bankable climate projects

ISLAMABAD: Pakistan and the United Kingdom (UK) have formalized a comprehensive climate partnership with the launch of a Green Compact that aims to enhance climate resilience, accelerate clean energy transition and scale up nature-based solutions, including mangrove conservation, Pakistani state media reported on Sunday.

The agreement, signed in Islamabad by Federal Minister for Climate Change and Environmental Coordination Dr. Musadik Malik and UK Minister for International Development Jennifer Chapman, unlocks £35 million in targeted support for green development and long-term climate action, according to Radio Pakistan broadcaster.

Pakistan ranks among nations most vulnerable to climate change and has seen erratic changes in its weather patterns that have led to frequent heatwaves, untimely rains, storms, cyclones, floods and droughts in recent years. In 2022, monsoon floods killed over 1,700 people, displaced another 33 million and caused over $30 billion losses, while another 1,037 people were killed in floods this year.

Mohammad Saleem Shaikh, a spokesperson for Pakistan’s Ministry of Climate Change, described the compact as a “decisive move toward action-oriented climate cooperation,” noting that its implementation over the next decade will be critical for Pakistan which regularly faces floods, heatwaves and water stress.

“The Compact is structured around five core pillars: climate finance and investment, clean energy transition, nature-based solutions, innovation and youth empowerment, and adaptation and resilience,” the report read.

“Under the agreement, the UK will work with Pakistan to mobilize public and private climate finance, strengthen regulatory frameworks for green investment, and develop bankable climate projects.”

Clean energy forms a central component of Pakistan’s transition, with Islamabad planning to expand solar and wind generation to reduce fossil fuel dependence, improve energy security and stabilize power costs, according to Shaikh.

“Renewable energy is now economically competitive, making the transition both environmentally and financially viable,” he was quoted as saying.

“Nature-based solutions, particularly large-scale mangrove restoration, will protect coastal communities from storm surges and erosion while enhancing biodiversity and carbon sequestration.”

Under the Compact, technical support, mentoring and access to investors will be provided to climate-smart startups and young innovators, reflecting Pakistan’s recognition of youth-led initiatives as central to future climate solutions.

On the occasion, Chapman, on her first official visit to Pakistan, underscored the urgency of climate action, highlighting the UK’s support for renewable energy, mangrove and ecosystem restoration, early-warning systems, climate budgeting and international investment flows into Pakistan.

Shaikh described the Green Compact as “a strategic turning point” in Pakistan–UK relations on climate change, saying its effective implementation is essential for Pakistan to meet its national climate targets.