Pakistan is experiencing soaring demand for electricity across all of the sectors of its economy. The new demand is being met by rapidly growing deployment of distributed solar, estimated at 38 GW as of June, 2025. In 2025, 44% of solar deployment was residential, followed by industry (26%), agriculture (21%) and commercial users (9%). The expansion of distributed solar has enhanced electrification across the economy, lifting Pakistan's electrification rate to 21.7% in FY2025 from 17% in FY2023, close to the global average of 22%. This surge to over 200 terawatt-hours of electricity is not reflected in official data, according to a report by Ember Energy titled "The solarization of Pakistan's energy economy".
The solar energy revolution in Pakistan is led by consumers. Driven by soaring electricity costs, unreliable grid infrastructure, and cheap imported solar panels, millions of households and businesses have installed rooftop solar. This rapid transition to solar has transformed the country's energy landscape. According to the report, Pakistan’s total electricity demand increased by 33 terawatt-hours (TWh) between fiscal years 2023 and 2025. Distributed solar generation alone grew by 36 TWh during the same period, making it the primary driver of electricity demand growth and offsetting declines elsewhere in the power system.
"Pakistan has a thirst for energy, and solar is providing it," said Dave Jones, Chief Analyst at Ember. "Distributed solar is so fast and cheap to build, that it is actually driving up electricity demand." The newly added solar capacity has saved more than US$12 billion in oil and gas imports by February, 2026, Ember said, as well as enabling growth in the agriculture, industrial and commercial parts of Pakistan’s economy.
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| Actual Solar Deployment in Pakistan Far Exceeds Official Stats. Source: Ember |
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5 comments:
Economic reasons unnessarily generated by the rulers, setting prohibitively high prices and taxation on grid electricity. Now they're trying to discourage solar power usage by multiple means, like finishing net metering policy and imposing direct taxation on solar power users. Typical of our ruling establishments right from 1947, do away with anything that benefits the populace, a continuing colonial legacy of British raj.
Suhail: “Economic reasons unnessarily generated by the rulers, setting prohibitively high prices and taxation on grid electricity. Now they're trying to discourage solar power usage by multiple means, like finishing net metering policy and imposing direct taxation …..”
It’s an unplanned solar revolution. I think the next big energy revolution in Pakistan will be the addition of batteries which will help allow solar electricity use around the clock. The government too is adding grid scale battery storage systems which will bring down the cost of grid electricity and reduce Pakistan’s dependence on fossil fuel imports. https://www.statista.com/chart/23807/lithium-ion-battery-prices/?srsltid=AfmBOoo-7nlSLvnaKPW5b-RzGPSiXXumW_5bZn_4Mky2ycYOw27DXqna
New Record Lows for Battery Prices
https://about.bnef.com/insights/clean-transport/new-record-lows-for-battery-prices/
Lithium-ion battery prices dropped again in 2025, with average prices coming down 8% to $108 per kilowatt-hour, according to BloombergNEF’s annual price survey.
China still leads
China’s lead in low battery prices continued in 2025, with average prices in the country dropping 13% to $84/kWh. This is due to a combination of lower input costs, overcapacity, intense price competition and preference for lower-cost lithium iron phosphate (LFP) cells.
Prices in North America and Europe were 44% and 56% higher, which is a big part of why EVs in those regions still cost more than their combustion counterparts. In China, price parity has already been achieved in almost all vehicle segments.
This year, the lowest observed cell and pack prices were just $36/kWh and $50/kWh, respectively. These were for LFP batteries going into stationary storage applications. Similar lows were observed last year, which indicates these price levels are no longer extreme outliers.
BNEF has been doing this price survey for 15 years now, and each year when the top-line number lands, there’s a steady stream of commentary attributing the drop to producers slashing margins. Margins did dip slightly in the first half of this year, but that alone doesn’t fully account for the drop. There’s real innovation and efficiency improvements going on, too, and prices are now down 93% since 2010 in real terms.
Material price rise
Perhaps the most intriguing storyline from the 2025 survey is what didn’t happen.
Cobalt prices rose sharply this year after the Democratic Republic of the Congo introduced export quotas, and lithium ticked up, too. But battery prices didn’t rise. The industry absorbed these shocks through greater LFP adoption, long-term contracts and broader hedging strategies.
This is a markedly different picture from just a few years ago, when higher reliance on nickel manganese cobalt (NMC) cathodes meant a spike in metal prices led directly to batteries bucking their long-term downward trend.
It’s probably too early to celebrate — if elevated metal prices persist, the effect will eventually show up in battery figures — but even this level of resilience to underlying material price changes shows how far the battery industry has come.
The diversification trend is set to continue in the years ahead as sodium-ion battery production capacity is starting to come online, and other new cathode and anode chemistries are approaching commercialization.
Stationary storage costs are plummeting
The average pack price for stationary storage systems dropped to $70/kWh, 45% lower than in 2024. This is the sharpest drop across all segments and makes stationary storage the lowest-priced segment for the first time.
This was largely driven by intense competition in China, where there’s immense overcapacity for battery cells specifically aimed at stationary storage applications. China’s production for stationary storage cells in 2025 is estimated at 557 GWh, over double global installations in the sector.
Grid scale storage in batteries will become commercials viable for base load use cases once sodium ion batteries become mainstream..
We are talking around 2030.
2026: The Year of Validation for Sodium-ion Batteries
https://autonews.gasgoo.com/articles/news/2026-the-year-of-validation-for-sodium-ion-batteries-2072318186333450240
Gasgoo Munich-For a long time, the market has measured sodium-ion batteries against a lithium-ion yardstick. Because their energy density trails that of lithium iron phosphate (LFP), they are often dismissed as low-end substitutes, with their market potential seen as merely tracking lithium carbonate prices.
A recent report from Northeast Securities offers a different perspective. It identifies 2026 as a pivotal year for validating the industrialization of sodium-ion technology. The core value of sodium batteries, the report argues, lies not in displacing the existing LFP market, but in carving out niches where lithium economics falter—specifically, high-cold energy storage, long-duration storage, and data center backup power—leveraging their low-temperature performance, long cycle life, and high safety.
In these scenarios, lithium batteries either suffer severe degradation in the cold or fail to pencil out economically over long cycles. Sodium-ion batteries fill that gap. The two are better seen as complementary than as substitutes.
Judging by the industry's momentum, sodium-ion technology is moving past the hype phase. While cathode technology routes have largely solidified, the anode remains the biggest variable. Costs haven't yet caught up to LFP, but as scaling production drives down material prices, the industry widely expects cell cost parity to arrive between late 2026 and 2027.
The entire supply chain, from battery makers to material suppliers, has staked out its positions to varying degrees, and the segmentation within the sector is becoming increasingly clear. Moving beyond simple price comparisons, sodium-ion batteries are proving their worth through real-world deployment and cost optimization.
Sodium-Ion Has Its Own Battleground
One major market misjudgment is measuring sodium-ion solely by energy density, overlooking how physical differences dictate suitability for specific scenarios.
Calculations by Northeast Securities highlight several standout performance features of sodium-ion batteries: they retain over 90% of their capacity at minus 40 degrees Celsius, boast a cycle life that can exceed 15,000 cycles, and have a higher thermal runaway trigger temperature than lithium batteries. These characteristics make them uniquely suited for applications like wind and solar storage in frigid northern climates, four- to eight-hour long-duration storage, data center backup power, and automotive start-stop systems.
In these contexts, LFP either suffers significant low-temperature degradation or offers weak economics over long cycles, making sodium-ion the more appropriate choice.
After years of technical iteration, cathode routes have largely solidified. The polyanionic route, relying on ultra-long cycle life and low costs, is expected to account for 77% of shipments by 2025, firmly securing its position as the mainstream for energy storage. Layered oxides, targeting the power market, will see their share shrink to under 20%. Meanwhile, the commercial space for Prussian blue is narrowing due to persistent issues with crystalline water stability.
The biggest variable now lies in the anode. Hard carbon is currently the only option achieving mass production, but the battle over different raw material routes is far from over. Biomass-based production is the fastest, relying on coconut shells, but dependence on imports raises supply chain security concerns. Local routes using straw and bamboo are accelerating to offset this reliance. Coal-based and pitch-based options offer greater theoretical cost reduction potential, but their process maturity still lags.
By 2026, anode-free battery technology will also reach its mass production window. If successful, it could reshape the cost structure of anodes—a trend worth monitoring closely.
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