KARACHI: K-Electric, Karachi’s sole power distributor, is facing mounting financial pressure as banks have reportedly stopped extending fresh financing and begun withdrawing existing credit facilities.
Sources said around Rs65 billion in liquidity had been withdrawn from K-Electric’s accounts, including nearly Rs30 billion directly pulled back by banks, further tightening the utility’s financial position.
The funding squeeze has reportedly been linked to the prolonged dispute over K-Electric’s tariff framework for the 2024–2030 period, which remains unresolved.
NEPRA approved a tariff of Rs39 per unit in 2025 following a two-year delay. The regulator later took suo motu notice of the decision, suspended the tariff and subsequently revised it to Rs32 per unit.
The lower tariff has added to K-Electric’s financial difficulties, sources said. The company has challenged the revised tariff before the NEPRA tribunal, where its petition remains pending.
Sources said the worsening cash-flow situation was beginning to affect K-Electric’s day-to-day operations, with procurement and other routine activities reportedly facing delays due to limited funds.
K-Electric has also informed the Pakistan Stock Exchange (PSX) about the delay in issuing its financial statements. In its communication, the company cited the ongoing tariff litigation as a key reason the statements could not yet be finalised.
The company said the tariff issue remains sub judice before the NEPRA tribunal, preventing completion of the financial reporting process.
Sources warned that maintaining operations could become increasingly difficult if the lower tariff remains in place for an extended period, potentially placing further strain on the utility’s finances.
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