INSUBCONTINENT EXCLUSIVE:
capacity of 46,600 MW, a slight increase from the previous year
Almost 14% of this capacity remains idle, especially during off-peak winter months when demand can drop as low as 12,000 MW.The core issue
here lies in capacity payments, fixed fees paid to power plants regardless of whether they produce electricity, which have soared as high as
2.1 trillion Pakistan rupees($7.45 billion) annually.This cost burdens consumers even when plants are dormant.Fossil fuels, renewables and
but contributes only 46% of actual generation, as older, inefficient plants remain on standby, collecting payments.While hydropower, nuclear
Net-metered solar capacity surged from 1.3 GW to nearly 4.9 GW in one year, driven by over 17 GW of Chinese solar panels in 2024.This solar
boom, however, leads to grid instability from fluctuating supply, rising electricity tariffs for non-net-metering users and unequal access
2,000 MW of idle power to Bitcoin mining and AI data centers.Proponents argue this could monetize wasted off-peak electricity, ease grid
strain by absorbing excess supply and generate revenue through digital assets.Critics, however, warn of increased fossil fuel reliance,
environmental concerns and whether benefits will truly reach ordinary Pakistanis
crisis, marked by expensive, underutilized power plants and soaring bills, took an unexpected turn in May 2025
The government announced a plan to redirect 2,000 MW of idle electricity toward Bitcoin mining and AI data centers.This bold move was
was simple: Turn surplus power into revenue
Bin Saqib pitched Pakistan at Bitcoin 2025 in Las Vegas as an ideal mining location due to its cheap, untapped electricity, attracting
global miners seeking new homes after crackdowns elsewhere.News outlets like Reuters and Bloomberg covered the story, framing it as Phase 1
The government defended the plan by highlighting the 2.8 trillion Pakistan rupees annual cost of idle plants, a potential $500 million
yearly revenue from mining and the creation of thousands of tech jobs.The underlying question remains whether this is a sustainable
long-term solution or a short-term fix.Did you know? Binance co-founder Changpeng Zhao was appointed a strategic adviser to the Pakistan
centers involves concrete operational steps and strategic implementations
In this section, we examine a few.Repurposing old coal plantsThe plan relies on utilizing underused coal power plants, some operating at
This aims to transform a financial liability into a revenue stream.Still, concerns persist about the high running costs and environmental
power projects like Sahiwal, China Hub and Port Qasim.Infrastructure and digital frameworksBeyond electricity, success requires attracting
weak grid infrastructure will need upgrades to handle continuous, round-the-clock power demands.Digitally, Pakistan is creating a National
Bitcoin Wallet for government-held reserves and a Pakistan Digital Asset Authority (PDAA) for licensing, taxation and Anti-Money Laundering
Customs breaks on ASIC mining machines are also being offered to attract investment.The electricity price challengeThe main hurdle is
At commercial rates (~$0.22/kWh), mining in Pakistan is significantly more expensive than in competing regions.A proposed subsidized rate of
$0.09/kWh aims to improve competitiveness, but still faces potential pushback from the IMF, as energy subsidies contradict bailout
underutilized thermal power plants into a revenue stream through Bitcoin mining and AI data centers
This seeks to transform capacity payments, a financial burden, into high-value digital assets.Additionally, Pakistan intends to leverage its
centers and digital innovation.Also, the plan includes incentives like tax breaks and duty exemptions to attract significant foreign direct
investment from global Bitcoin miners and AI firms, fostering high-tech job growth and boosting the local digital economy.As part of the
as a long-term sovereign asset, signaling a commitment to integrating digital assets into its economic stability framework.Did you know? In
April 2018, the State Bank of Pakistan (SBP) issued a circular prohibiting financial institutions from dealing in cryptocurrencies, halting
trading through traditional banking channels
New policies, therefore, demonstrate a remarkable U-turn
Challenges of Bitcoin mining in Pakistan Despite the promising potential of Bitcoin mining,
Pakistan faces an uphill battle in establishing a sustainable and stable mining industry.Sustainability and grid reliabilityRelying on
inconsistencies and high transmission losses, adds risk to maintaining uninterrupted power for mining operations.IMF scrutiny and financial
ongoing Extended Fund Facility (EFF) negotiations.Fears exist that the initiative could complicate budget talks and that energy subsidies
might contravene bailout conditions.Energy security and public welfareA critical risk is the potential diversion of power from households
Despite assurances, if mining exacerbates existing power shortages or drives up consumer tariffs, it could lead to public unrest and
undermine the perceived economic benefits.Regulatory ambiguityDespite the establishment of the PCC and PDAA, legal and regulatory clarity
deterring foreign investors and exposing participants to legal and compliance risks
allocates 2,000 MW for mining and AI data centers.Future phases are slated to integrate renewable energy sources (solar, wind, hydropower),
allocation and subsidies are critical
global Bitcoin miners and AI operators
While initial interest is reported, the actual deployment of the allocated megawatts will be the true test.Global players will monitor
operational facilities serving as key indicators.
