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Pakistan’s energy landscape is undergoing a major transformation. Shrinking energy supplies, weak demand, and rising fuel costs defined the fiscal year 2024 (FY24). The country is steadily moving away from fossil fuels, according to the Pakistan Energy Market Review (PEMR) 2025 by Renewables First, an energy think tank.
☀️Pakistan’s fossil fuel demand keeps falling as solar surges. It’s citizens are driving a quiet energy revolution not by design, but by necessity.
📊 Explore the shift in the new Pakistan Energy Market Review 2025: https://t.co/8mv55Orrq7
— Renewables First (@renewables1st) November 5, 2025
Fossil Fuels Market Sees Second Year of Decline
Pakistan’s energy supplies and consumption fell again in FY24 as weak demand, high fuel costs, and macroeconomic challenges reshaped the energy landscape. The report highlighted the country’s gradual but steady shift toward non-fossil energy sources.
According to the report, Pakistan’s primary energy supply declined 2% year-on-year to 81 million tonnes of oil equivalent (Mtoe) in FY24. This marks the second consecutive annual drop in total energy supply.
Final energy consumption fell 7% year-on-year to 43 Mtoe, mainly due to affordability constraints and subdued industrial and agricultural activity.
The report noted that crude oil production rose 2% year-on-year in FY24 but remains 25% lower compared to a decade ago. Indigenous natural gas supplies continued to fall, registering a 4% decline year-on-year, which increased dependence on imported liquefied natural gas (LNG).
LNG imports grew 13% year-on-year, driven by long-term contractual obligations. However, affordability challenges limited industrial demand.
Coal imports declined 39% year-on-year, while domestic coal production rose 28%, reducing import reliance to 39% of total coal supply. Despite this, coal consumption continued to contract for the third consecutive year, falling 3% in FY24.
Renewables Expand Rapidly
Pakistan’s non-fossil energy supplies, including hydel, nuclear, and renewables such as solar, rose from 11 Mtoe in FY21 to 17 Mtoe in FY24, a 49% increase over three years. This shift has reduced the share of fossil fuels in the overall energy mix, while coal’s share fell from 19% in FY21 to 15% in FY24.
The industrial sector recorded a 21% year-on-year drop in energy consumption in FY24, marking the sharpest decline across all sectors. The slowdown was driven by weak manufacturing activity and the rising adoption of alternative energy sources like solar.
The agriculture sector’s grid electricity use fell 10% year-on-year as more farmers turned to solar-powered solutions to manage energy costs. The commercial sector saw a 23% year-on-year decline in electricity consumption due to similar solar adoption trends.
Outlook
The report concluded that Pakistan’s energy transition is being shaped by affordability constraints, declining fossil fuel reliance, and rapid solar growth. As distributed and rooftop solar capacity expand, the country’s power mix is gradually becoming more diversified, signalling the start of a long-term shift toward a cleaner and more sustainable energy future.
