ISLAMABAD: The Central Power Purchasing Agency – Guaranteed (CPPA-G) revealed on Wednesday that the country’s power sector circular debt stood at Rs 1.614 trillion as of June 30, 2025, excluding the financial impact of recovery shortfalls and distribution losses.
The disclosure came during a public hearing at the National Electric Power Regulatory Authority (NEPRA) on the Fuel Cost Adjustment (FCA) for June 2025. NEPRA Chairman Waseem Mukhtar asked CPPA-G CEO Reihan Akhtar for the final circular debt figure as of the end of the fiscal year. In response, Akhtar confirmed the figure but clarified that it did not include financial losses due to under-recoveries and distribution inefficiencies.
Interestingly, this statement came just a day after the Power Division told the Prime Minister during a Cabinet Committee on Energy (CCoE) meeting that circular debt was Rs 780 billion as of June 30, 2025 — a significantly lower figure.
Chairman NEPRA directed the CEO CPPA-G to formally share the complete data with NEPRA, including financial impacts of recovery shortfalls and distribution losses, ahead of next week’s hearing on Quarterly Tariff Adjustment (QTA).
According to a summary presented to the CCoE and seen by Newzshewz, the total stock of circular debt stood at Rs 1.614 trillion in FY 2024–25, down from Rs 2.393 trillion in FY 2023–24 — a reduction of Rs 780 billion or 32.5% year-on-year.
Sources said payables to power producers fell to Rs 861 billion in FY 2024–25 from Rs 1.6 trillion in FY 2023–24. Payables by GENCOs to fuel suppliers dropped to Rs 93 billion, down from Rs 110 billion. The amount parked in Power Holding Limited (PHL) was also reduced to Rs 660 billion from Rs 683 billion.
The Power Division claimed that the circular debt stock posted negative growth of Rs 780 billion in FY 2024–25, compared to positive growth of Rs 83 billion in the previous fiscal year.
Breakdown of key financial components in FY 2024–25 includes:(i) budgeted but unreleased subsidies: Rs 28 billion ;(ii) interest charges: Rs 58 billion ;(iii) pending generation cost (QTA + FCA): Negative Rs 85 billion; (iv) non-payment by K-Electric: Rs 4 billion ;(v) Discos’ technical and commercial losses: Rs 265 billion;(vi) under-recoveries by Discos: Rs 132 billion ; and (v) other adjustments (PYA recoveries, etc.): Negative Rs 358 billion
Despite these factors, net circular debt growth was recorded at just Rs 45 billion in FY 2024–25 compared to Rs 457 billion the previous year.
As of June 2025, K-Electric owed Rs 218 billion, comprising Rs 31 billion in principal and Rs 187 billion in markup, to the national grid system. Ends
