Why is Electricity Cheaper in Some Countries and Expensive in Pakistan

Electricity is one of the most essential utilities of modern life, yet its cost varies widely across the world. While some countries enjoy relatively low electricity rates, others, including Pakistan, continue to face high and rising prices. The difference lies in factors such as energy resources, government policy, infrastructure, and long-term planning. Understanding these dynamics explains why the electricity unit price in Pakistan is more expensive than in other countries.

Major Reasons for Cheap Electricity

Abundant Natural Resources

Countries like Norway and Canada benefit from vast hydropower resources. Similarly, Middle Eastern nations, including Saudi Arabia and Qatar, have access to cheap oil and natural gas. This local availability reduces reliance on imports, keeping electricity generation costs low.

Efficient Power Infrastructure

Developed economies invest heavily in transmission and distribution systems, which minimize losses. In contrast, countries with weak grids face higher costs due to line losses and inefficiency.

Stable Government Policies

Long-term energy policies and subsidies help stabilize consumer electricity prices. For example, France has maintained lower costs by investing in nuclear power and ensuring a consistent supply.

Diversified Energy Mix

Nations with a balanced mix of hydropower, renewables, nuclear, and fossil fuels can absorb global price shocks better than those relying on a single source.

Why Electricity is Expensive in Pakistan

Dependence on Imported Fuels

Pakistan generates a large share of its electricity using imported oil, coal, and LNG. Global price fluctuations directly affect domestic electricity tariffs, leaving little room for stability.

Rising Circular Debt

The country’s power sector has accumulated a massive circular debt, which continually pushes tariffs higher to cover financial gaps.

Infrastructure Losses

Transmission and distribution losses, including theft, add significant costs that are eventually passed on to consumers.

Limited Renewable Adoption

Although Pakistan has strong potential for solar and wind, renewable energy still accounts for a small portion of the energy mix. This keeps reliance on expensive fuels high.

Global Comparison

• Norway: Among the cheapest electricity in the world, thanks to 95% hydropower generation.
• United States: Moderate prices due to abundant natural gas and diversified energy sources.
• India: Slightly lower rates compared to Pakistan, primarily due to better integration of coal and renewable energy sources.
• Pakistan: Among the highest in South Asia, mainly due to imports, inefficiency, and debt.

This contrast shows how resource availability, management, and policy choices determine affordability.

The Way Forward for Pakistan

To make electricity more affordable, Pakistan must focus on:

• Expanding renewable energy, such as solar and wind, to reduce reliance on imports.
• Investing in hydropower for long-term cost stability.
• Reducing line losses through modernized infrastructure.
• Encouraging net metering so households can generate and sell solar power back to the grid

Final Word

Electricity is cheaper in countries that rely on local, renewable, or diversified energy sources and manage their power systems efficiently. Pakistan’s heavy dependence on imports and structural inefficiencies has kept its prices high. With the right policies and investments, Pakistan can gradually move toward a future where electricity is both affordable and sustainable.