KARACHI: Pakistan’s electricity regulator has approved a record-low tariff of Rs8.9189 per kilowatt-hour for a 240-megawatt hybrid wind-solar project near Karachi, marking the country’s first utility-scale renewable energy venture under a competitive bidding regime.
The National Electric Power Regulatory Authority (NEPRA) issued its decision July 17, granting final approval to Aerem Energy (Private) Limited, a special purpose vehicle formed by a consortium led by JCM Power Corporation, for the Dhabeji Grid project in Thatta District, Sindh. The tariff, discovered through a competitive bidding process conducted by K-Electric Limited, sets a new benchmark for renewable energy costs in Pakistan.
The 25-year tariff, which will be incorporated into an Energy Purchase Agreement with K-Electric, is subject to quarterly adjustments based on variations in interest rates, foreign exchange, and the Secured Overnight Financing Rate. The project comprises approximately 175 megawatts of wind and 94 megawatts (DC) of solar photovoltaic capacity, using equipment from suppliers including Goldwind, Envision, JA Solar, and Huawei.
NEPRA’s decision confirmed the project’s inclusion in the Indicative Generation Capacity Expansion Plan 2025-35 through an addendum submitted by the Independent System & Market Operator on July 13, 2026. The regulator noted that while ancillary calculations in the planning document “extend beyond the scope of IGCEP,” the tariff itself was validated through competitive bidding and subsequent review.
“This is the lowest tariff ever approved for a renewable energy project,” NEPRA stated in its decision. The regulatory body previously approved K-Electric’s bid evaluation report on May 26, 2025, after determining the competitiveness and reasonableness of the discovered tariff.
Aerem Energy, incorporated under Pakistani law, counts JCM Power Corporation with 51% ownership, Burj Energy International Management Ltd. with 30%, and Mr. Rana Nasim Ahmed with 19% as its sponsors. The project will be developed on approximately 1,674 acres of privately acquired land.
Under the terms of approval, the company must achieve financial close within three months of the Energy Purchase Agreement’s approval and complete construction within 18 months thereafter. Duties and taxes directly imposed on the applicant will be passed through to the power purchaser at actual costs, while wind and solar resource risks remain with the developer.
The project was initially optimized in K-Electric’s Power Acquisition Plan, approved by NEPRA on May 17, 2024, as part of the IGCEP 2022-31 which allocated 1,050 megawatts of solar and 350 megawatts of wind capacity to the utility.
The decision directs the federal government to notify the tariff in the official gazette within 30 days, as required under Section 31(7) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997. Should the government fail to do so, NEPRA retains authority to issue the notification itself.
