Karachi: K-Electric Limited, the sole vertically integrated power utility in Pakistan, has been assigned initial ratings by the Pakistan Credit Rating Agency Limited (PACRA) as it embarks on ambitious growth plans and navigates through crucial regulatory approvals.

According to The Pakistan Credit Rating Agency Limited announcement issued on 10 Sep 2024, the ratings reflect K-Electric’s strategic role in powering Karachi and adjacent regions in Sindh and Balochistan. The utility’s PKR 392 billion investment plan set from FY 2024 to FY 2030 aims to expand customer base by 30%, increase renewable energy contributions by 20%, and reduce power outages by 30%. These initiatives are part of K-Electric’s broader strategy to meet rising energy demands reliably and sustainably.

The ongoing tariff determination by the National Electric Power Regulatory Authority (NEPRA), crucial for the company’s financial health, remains unresolved since the expiration of the previous Multi-Year Tariff in June 2023. K-Electric has actively engaged NEPRA to expedite the approval process, especially for its generation segment, with a decision anticipated by the end of September 2024. Hearings for other business segments were also conducted recently, and their outcomes are eagerly awaited. The resolution of these tariff petitions is vital for maintaining the newly assigned ratings and assessing K-Electric’s financial stability and operational performance.

Additionally, K-Electric has issued a new sukuk, PPSTS-28, amounting to PKR 7 billion, to finance its working capital requirements, replacing the earlier PPSTS-23 sukuk. This financial maneuver underscores the company’s ongoing efforts to secure necessary funds for its operations amidst a challenging regulatory landscape.