The World Bank has approved $375.9 million in financing for the Grid Stability Enhancement Project in Pakistan, aimed at strengthening the national power transmission network.
The approval was granted by the World Bank Board of Executive Directors under the Boosting Energy Security through Transmission in Pakistan program, known as BEST-PAK, a Multiphase Programmatic Approach.
The project marks the first phase of a ten year program designed to help Pakistan modernise its electricity transmission network, reduce power outages, and expand access to clean energy for homes, businesses and industries, according to a statement issued by the World Bank.
Bolormaa Amgaabazar, World Bank Country Director for Pakistan, said the energy challenges facing Pakistan are closely tied to broader economic stability.
She added that investment in advanced technologies for a more resilient transmission network would help reduce electricity costs, bring more renewable energy onto the grid, and support a power sector that serves households, businesses, industries and the wider economy of Pakistan.
The electricity network in Pakistan has long faced grid instability and transmission bottlenecks that restrict the delivery of reliable power and leave clean energy generation underused. These issues affect millions of people across the country every day through frequent outages, higher electricity costs, and lost economic opportunities.
Under the project, advanced equipment will be installed to stabilise the transmission grid and improve the flow of electricity at key substations. This includes Static Synchronous Compensators, or STATCOMs, at three major 500 kV substations, along with fixed reactors and capacitor banks across 26 grid substations.
The upgrades are expected to bring 640MW of currently curtailed wind energy onto the grid, enabling full use of 1,840MW of wind capacity in southern Pakistan by transferring power to major demand centres. The project will also support integration of roughly 491MW of planned renewable energy projects led by the private sector.
According to the World Bank statement, these improvements will help move Pakistan toward its national commitment of achieving 60 percent renewable energy in its electricity mix by 2030, in line with the Nationally Determined Contribution of the country under the Paris Agreement.
Over its lifetime, the project is expected to avoid about 832,500 tons of CO2 emissions each year, or more than 20.8 million tons cumulatively over 25 years.
Waleed Saleh Alsuraih, Lead Energy Specialist for the BEST-PAK program at the World Bank, said a reliable and modern transmission grid is essential for the energy future of Pakistan.
He noted that as the first phase of the BEST-PAK program, the project opens a pathway to large scale clean energy deployment, stronger energy security, and a modern, commercially oriented transmission sector, through targeted infrastructure investment and institutional reform that create conditions for future private capital participation.
The project also supports the ongoing transmission sector reform agenda of the government, centred on restructuring the National Transmission and Dispatch Company into specialised successor entities.
It is designed to accelerate reforms intended to strengthen governance, accountability, operational performance and long term sustainability across the power sector.
The World Bank noted that Pakistan is among the countries most exposed to climate related risks, including river and urban flooding and extreme heat events.
As a result, the project design requires all new installations to meet climate resilient specifications, including elevated platforms above ground level to reduce flood exposure and equipment built to operate in temperatures of up to 55 degrees Celsius. These measures are intended to ensure reliable performance during monsoon seasons and heatwaves.
