KHYBER Pakhtunkhwa has rivers powerful enough to light Pakistan. Its waters feed Tarbela, Ghazi-Barotha and a chain of hydropower projects that together supply roughly 35% of the country’s total hydroelectric generation capacity. Electricity produced in KP travels across the national grid, powering homes, factories and industries from Karachi to Lahore, while families living beside those same rivers endure up to 18 hours of daily load shedding in summer heat that regularly exceeds 45°C. The gap between what KP contributes to the national grid and what its citizens receive in return is not a geographical accident. It is an institutional failure that the federal compact was specifically designed to prevent and has repeatedly failed to address.
The financial dimension of this compact is where the injustice becomes constitutionally measurable. Under Article 161(2) of the Constitution, provinces hosting hydropower plants are entitled to net hydel profit (NHP) from the use of their rivers. Yet after four decades, outstanding NHP arrears owed to KP have reportedly reached approximately Rs 2.3 trillion, more than its entire annual budget reflecting years of delayed settlements and disputed calculations. As recently as September 2025, WAPDA owed KP Rs 49.565 billion in current NHP dues alone. This federal failure is real, consequential and documented. But it is not the whole story. KP cannot demand accountability from Islamabad while ignoring what PESCO’s own figures reveal about losses within the province.
During the first eleven months of FY2024-25, electricity theft and technical inefficiencies cost Rs 193.4 billion, roughly Rs 583 million every day. Bannu recorded losses of 73.86%, meaning fewer than 27 of every 100 units entering its network were billed and recovered. Tank stood at 66.19%, Karak at 65.24%, D.I. Khan at 57.94% and Mardan at 44.92%. Peshawar, despite a lower loss rate, suffered the highest financial loss at Rs 51.44 billion because of its distribution volume. Overall, PESCO recorded Rs 96 billion in transmission losses in FY2024-25, the highest among Pakistan’s distribution companies, while annual operational losses of about Rs 130 billion add directly to the national circular debt ultimately borne by consumers.
These figures explain why load shedding is particularly severe in high-loss areas, but they cannot justify punishing consumers who pay honestly. The honest consumer in Peshawar, Nowshera or Swat is not responsible for theft in Bannu or Karak. He pays in full yet endures the same outages as his neighbour who does not, because the system punishes geography rather than behaviour. High-loss feeders require better metering, sustained enforcement and an end to political protection for influential defaulters. PESCO officials have publicly said anti-theft operations cannot succeed without local cooperation, which is often withheld when enforcement threatens politically connected consumers. The KP government cannot demand reduced load shedding while shielding those whose non-payment makes it financially impossible.
In the newly merged tribal districts, the problem takes a different character. The absence of functioning meters, the weakness of billing infrastructure and the legacy of decades during which electricity was neither properly metered nor reliably supplied have created a population that cannot reasonably be held to the same recovery standards as districts with established utility relationships. The obligation here runs in both directions: consumers must ultimately enter the billing system, but the state must first deliver a system worth entering, with meters that work, bills that are accurate and supply that is reliable enough to justify payment.
The economic cost of this failure extends far beyond inconvenient evenings. A factory that loses twelve hours of production daily is not competitive. A shop that cannot refrigerate its inventory loses stock. A student who cannot study after dark falls behind peers in cities where LESCO, IESCO and GEPCO report no feeders with load shedding exceeding ten hours. A digital worker in Peshawar competing for remote work with counterparts in Lahore operates at a structural disadvantage that no amount of skill or effort can fully overcome. In a province already struggling to attract industrial investment and create formal employment, unreliable electricity is not merely an inconvenience. It is an economic tax levied daily on 40 million people who have already paid a heavier security tax than any other province in the country for the past three decades.
The solution requires three things to happen simultaneously. The federal government must settle KP’s NHP arrears through a transparent, time-bound mechanism, not committees that meet repeatedly without resolution. KP must provide sustained political backing for action against electricity theft, including influential consumers whose protection has made PESCO’s recovery crisis intractable. And PESCO must upgrade its ageing distribution infrastructure, particularly in merged districts and former FATA areas where reliable metering and billing remain inadequate.
KP’s tragedy is not that it lacks power. It is that it has power, yet lacks power over its own fate. Its rivers generate electricity for the nation, its people pay for electricity they often do not receive, Islamabad delays what the Constitution promises and KP too often fails to control the theft and inefficiency within its own borders. Between federal denial and provincial failure stands the ordinary citizen paying his bill, losing his hours, closing his shop, stopping his machinery and sitting with his family in the dark. The rivers keep flowing, the electricity keeps leaving, the promises keep coming, yet the people of KP remain trapped in a darkness created not by scarcity, but by a system that has repeatedly failed to turn abundance into justice.
—The writer is PhD in Political Science, and visiting faculty at QAU Islamabad.
