K-Electric

K-Electric has announced investments of approximately USD 1.7 billion in ‘new frontiers’ by 2030. However, a detailed breakdown of these investments is unavailable. These funds will be allocated towards both the growth of renewables capacity and thermal energy sources. The company’s primary focus is reducing its dependence on imported energy resources and increasing use of locally available coal and other fossil fuel-based energy sources. K-Electric failed to decrease the emissions intensity of its own generation between 2017 and 2021. To align with its 1.5°C pathway in 2027, the company must reduce the emissions intensity of its own generation by about 7% per year. K-Electric significantly exceeds its 1.5°C carbon budget for the period 2022-2037.

The company has not implemented board-level oversight of climate change. Further, there is no evidence that K-Electric has a low-carbon transition plan. The company can improve by integrating climate change oversight and low-carbon transition at a strategic level and establishing a time-bound action plan that outlines how it will transition to a low-carbon economy. The plan should include medium- and long-term targets, verifiable and quantifiable key performance indicators and financial commitments. In addition, the plan should be informed by scenario analysis to ensure its ambition is sufficient to align with a 1.5°C pathway.

K-Electric actively supports customers in their efforts to obtain electricity generation licenses, allowing them to sell any excess electricity they produce back to the power utility. Since the beginning of this initiative, a cumulative total of 5,181 cases have been commissioned, resulting in an injection of 100 megawatts (MW) of photovoltaic (PV) energy into the system. Moreover, K-Electric encourages its customers to adopt smart meters, and in 2021, 100% of its industrial customers transitioned to smart meters. The company can improve further by creating a client engagement strategy governed by a clear policy and integrated into business decision-making.

K-Electric does not have any emissions reduction targets. The company aims to set them in the next 12 months.

K-Electric plans to add 1,182 MW of renewable energy capacity to its generation fleet by 2030. It is also starting the construction of new grids and interconnections which will allow the import of about 2 GW of power from the national grid. With this addition from the national grid, the company’s share of renewable electricity should reach 30% of its portfolio in 2030. The company is expected to commission Pakistan’s first 500 MW floating solar power plant by 2025. It also runs several energy efficiency initiatives and is implementing measures to reduce transmission and distribution (T&D) loss.

In 2021, about 87% of the company’s electricity was generated from coal. The majority of the remaining electricity was generated by fossil gas-powered plants. K-Electric has launched a subsidiary, K-Solar, which has about 3 MW installed solar power capacity. However, the company is also growing its fossil fuel-based generation capacity and actively exploring options for developing base load power projects dependent on locally available coal.

K-Electric significantly exceeds its 1.5°C carbon budget for the period 2022-2037. The company’s emissions intensity trend remained static between 2017 and 2021. The company neither reports its capital expenditure (CapEx) in low-carbon technologies nor its research and development (R&D) investments.

Despite K-Electric’s intentions to integrate renewable energy capacity into its generation portfolio by 2030, the company plans to sustain a substantial reliance on fossil fuels, particularly coal. The company’s lack of emissions reduction targets, a coherent transition plan and financial commitments for decarbonisation raise doubts about its capability to progress towards a low-carbon economy.

No evidence was found that the company commits to having social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company has ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found to show the company undertakes low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

The company discloses the measures it takes to ensure that these jobs embed equality of opportunity for women and vulnerable groups. It does this through recruiting, training and deploying female meter readers in Pakistan. However, no evidence was found of the company commitment to create and support access to green and decent jobs as part of the low-carbon transition. Furthermore, no relevant disclosure was found of the company’s assessment of employment dislocation risks. No public commitment by the company was found stating its intention to re-skill and up-skill workers displaced by the transition to a low-carbon economy. Additionally, no evidence was found that the company re-skills and up-skills workers in a way that ensures gender balance and inclusion of vulnerable groups.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights. However, no evidence that the company commits to respecting the ILO fundamental rights at work, nor does it expect its business relationships to respect the same commitment. Moreover, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and supply chain. No evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. No evidence was found of the company having a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. No evidence was found of a time-bound target for paying all workers a living wage. While the company discloses the proportion of its direct workforce covered by collective bargaining agreements, no relevant disclosure was found of the company’s required working hours. The company discloses the gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. The company commits to gender equality and women’s empowerment.

No evidence was found of a privacy statement regarding the collection, sharing and access to personal data. While the company discloses its corporate income tax paid for each relevant jurisdiction, no relevant disclosure was found of its global tax strategy. No evidence that the company has a policy prohibiting bribery and corruption. Moreover, no evidence that the company has a lobbying and political engagement policy, nor does it specifies that it does not make political contributions. No relevant disclosure was found of the company’s expenditure on lobbying activities.