Pakistan’s energy landscape is at a critical juncture. With over 35% of the national energy mix reliant on natural gas, the country faces a deepening crisis due to depleting domestic reserves and stagnant production. By 2030, gas demand is projected to reach 6,213 MMSCFD, far outpacing declining supply. This growing shortfall threatens energy security and underscores the urgent need for a climate-resilient, sustainable strategy.
Despite this urgency, substantial subsidies-amounting to Rs 814 billion in FY 2024-are still extended to the fertiliser sector. While agriculture is vital, continuing subsidies amid a strained gas supply raises serious sustainability concerns. A balanced approach is needed-one that meets energy needs while aligning with environmental and economic imperatives.
Pakistan’s existing gas infrastructure is vast, spanning over 13,989 km of transmission pipelines and serving over 10 million consumers. Yet winter shortages persist, with households and the power sector-consuming 864 and 894 MMCFD, respectively-facing low pressure and outages. Meanwhile, distribution losses remain alarmingly high, with SSGC reporting 18.28% and SNGPL 12.32% in Unaccounted-for Gas (UFG), largely from ageing infrastructure and leakages in residential networks.
To address these systemic issues, Pakistan must implement a phased, comprehensive reform strategy. A viable starting point is transitioning residential users from piped natural gas to Liquefied Petroleum Gas (LPG), already widely used in rural areas. LPG is cleaner, portable, and requires no pipeline infrastructure, making it a cost-effective alternative that can ease pressure on the gas grid while improving indoor air quality and reducing reliance on firewood.
The future lies in transitioning from gas-intensive consumption to a diversified energy portfolio that includes LPG, solar,biogas, and energy-efficient electric solutions.
This transition offers numerous advantages: LPG reduces health risks, especially for women and children exposed to biomass smoke; curbs deforestation; and lowers the cost of infrastructure maintenance. Moreover, with a decentralised distribution model and better regulatory oversight, it enables more targeted subsidies and pricing flexibility.
Several global models offer guidance. India’s Pradhan Mantri Ujjwala Yojana extended free LPG connections to millions of low-income households, improving both health and environmental outcomes. Brazil, Mexico, and Thailand have also demonstrated successful LPG integration across rural and urban settings.
Pakistan can adopt a pilot project approach, starting with medium-sized cities such as Sahiwal, Larkana, or Haripur. These urban centres, with manageable populations and simple layouts, are ideal for systematic replacement of residential gas connections. SSGC and SNGPL can coordinate the establishment of community-level LPG hubs, mobile delivery systems, and digital booking platforms. Certified installers and safe appliances must be mandated to ensure safety and public trust.
In parallel, towns and villages not yet connected to the gas network should be prioritised for LPG adoption. This move would benefit low-income households, reduce indoor pollution, and create local employment in distribution and maintenance. With Pakistan’s LPG sector already mature, featuring 11 producers, 313 marketing companies, and over 6,000 distributors, the infrastructure for expansion is in place. OGRA’s regulatory oversight and existing Rs 6.57 billion investment provide a solid foundation for scaling.
To support this transition, targeted subsidies for low-income households, incentives for safety compliance, and robust public awareness campaigns are essential. A policy to prohibit piped gas connections in all new urban housing schemes-mandating LPG use instead-would further ensure sustainability and manage demand efficiently.
Another critical area for reform is the fertiliser sector, historically a major burden on national gas reserves. In 2024, gas subsidies for fertiliser feedstock reached Rs 814 billion, despite rising fertiliser prices that primarily benefit manufacturers, not farmers. To address this inefficiency, the government should gradually replace gas subsidies with direct support for fertiliser prices, ensuring benefits reach farmers while encouraging energy efficiency in the sector.
Demand-side management (DSM) must also be prioritised to optimise energy use. Promoting energy-efficient appliances-such as induction cookers, heat pumps, condensing gas boilers, and electric water heaters-can significantly reduce demand. Many of these technologies are already available, and their adoption in high-income households would alleviate pressure on the grid while setting a benchmark for efficiency.
The global shift toward solar-powered appliances-like solar geysers, cookers, and lighting systems-presents another opportunity. Pakistan must establish a clear regulatory and pricing framework to encourage solar adoption, ensuring competition, affordability, and accessibility across income levels. Strategic incentives and investment in logistics and technological development will further accelerate solar integration.
In rural regions, biogas provides a sustainable, dual-benefit solution-addressing both clean energy access and waste management. Derived from organic waste, biogas reduces dependence on firewood, improves indoor air quality, and cuts methane emissions. Government-backed subsidies, technical training, and local technician support can facilitate wide-scale biogas adoption, particularly in livestock-rich areas.
Equally important is the phasing out of inefficient appliances. Outdated equipment increases energy consumption, costs, and emissions. Establishing Minimum Efficiency Performance Standards (MEPS) and offering financial incentives for high-efficiency upgrades can create lasting change. Public awareness campaigns must accompany these reforms to encourage responsible consumer behaviour and widespread participation.
Pakistan’s energy crisis requires bold, climate-smart reforms, not piecemeal fixes. The future lies in transitioning from gas-intensive consumption to a diversified energy portfolio that includes LPG, solar, biogas, and energy-efficient electric solutions. This shift must be guided by robust policies, data-driven strategies, and reallocation of subsidies to sectors and users most in need. With over 250 million lives at stake, Pakistan must lead with foresight, aligning energy security with environmental stewardship. The choices made today will define whether we continue to struggle with scarcity or embrace a resilient, sustainable energy future-one that benefits both our people and the planet.
The writer is an experienced academic with over 20 years in engineering, currently at Dawood University of Engineering and Technology (DUET), Karachi, and a member of the FPCCI Central Standing Committee on Bioeconomy.