The federal government paid Rs. 2.935 trillion to Independent Power Producers (IPPs) during the first 11 months of fiscal year 2025-26, according to documents from the Ministry of Energy.
The payments covered electricity generated by different categories of independent power producers between July 2025 and May 2026.
According to the documents, the billing process for June 2026 had not yet been completed. This means the reported Rs. 2.935 trillion does not represent the full payment figure for the entire fiscal year.
The substantial amount paid to IPPs highlights the significant financial commitments associated with Pakistan’s electricity generation sector.
Independent Power Producers play an important role in supplying electricity to the national grid. Their payments are generally linked to electricity generation and the terms established under agreements with the government.
The Ministry of Energy has also clarified an important aspect of the payments. It said the government did not pay IPPs at rates above those determined by the National Electric Power Regulatory Authority (NEPRA) or rates specified in agreements with individual power producers.
This clarification comes amid continued public and political discussion about electricity costs, power-sector payments and the financial burden associated with Pakistan’s energy system.
NEPRA plays a key regulatory role in Pakistan’s electricity sector, including determining applicable tariffs and regulatory rates. The Ministry of Energy’s statement indicates that the payments reported in the documents were made according to the applicable regulatory determinations or contractual arrangements.
The Rs. 2.935 trillion figure covers an 11-month period, making it an important indicator of the scale of financial transactions between the government and private power producers.
However, the final expenditure for fiscal year 2025-26 could change once the June billing process is completed. The final figure will therefore provide a more complete picture of the government’s payments to IPPs during the financial year.
Pakistan’s power sector has faced longstanding challenges involving electricity costs, circular debt, generation capacity and payments to power producers. IPP payments remain an important part of discussions surrounding the financial sustainability of the electricity sector.
The government’s clarification on payment rates also provides context for understanding the reported expenditure. According to the Ministry of Energy, payments were not made above NEPRA-approved rates or the rates contained in agreements with power producers.
For consumers, developments involving IPP payments are significant because the overall financial health of the power sector can influence electricity tariffs, government subsidies and efforts to control energy-sector liabilities.
The latest documents therefore provide a snapshot of the government’s power-sector obligations during the first 11 months of fiscal year 2025-26.
With June billing still incomplete, attention is likely to remain on the final payment figures and the broader financial position of Pakistan’s electricity sector as the fiscal year comes to an end.
