Pakistan's Energy Crisis, Its Impact on Manufacturing Quality, and What It Means for Your Sustainability Reporting

The quality dimension: how load shedding affects production consistency

Textile wet processing is a temperature-sensitive, time-sensitive, chemistry-controlled industrial process. Dyeing, for example, requires precise temperature control over defined time periods, because the uptake of dye by fiber is a chemical reaction with temperature-dependent kinetics. A dye bath heated to 60�C that is interrupted halfway through the programmed cycle by a power failure and restarted with backup power at a slightly different temperature profile may produce a slightly different shade result than an uninterrupted process.

This is physics, not factory management failure. Chemistry at elevated temperature is sensitive to process conditions in ways that room-temperature chemistry is not.

The practical consequence: shade variation is a more common quality complaint in Pakistan- origin dyed products during periods of significant load shedding than during periods of stable grid supply. Buyers who have experienced unexplained shade variation in Pakistani shipments during 2022-2023 were often experiencing the downstream quality impact of grid instability in the production process.

The mitigation: working with suppliers who have invested in stable captive power infrastructure, ideally through grid backup systems (large UPS/battery storage, captive gas turbines, or increasingly solar with battery) that maintain process temperature and control during grid interruptions. Asking suppliers specifically about their captive power setup and whether it includes process-rated power quality is a practical question.

The sustainability reporting dimension: what energy source mix means for Scope 2

Pakistan's national electricity grid has an emission factor that changes year by year as the generation mix evolves. The grid has been incorporating more renewable capacity (hydro varies with rainfall and snowmelt, but wind and solar capacity have been growing), while also adding coal capacity through CPEC-era power plant construction. The net effect has been a grid emission factor that is significant (higher than many European grids) and that fluctuates.

For a Pakistani mill that draws exclusively from the national grid, the Scope 2 GHG calculation uses the grid emission factor for the specific year being reported. Using the correct year- specific Pakistan grid factor matters for accuracy, because the factor changes.

But many Pakistani mills don't draw exclusively from the grid. They use a mixture of: grid electricity, captive gas turbine generation, diesel backup generation, and increasingly on-site solar. Each of these has a different emission factor:

Grid electricity: Pakistan's national grid emission factor. Published by NEPRA (National Electric Power Regulatory Authority) and tracked by IEA. Approximately 0.35-0.45 kg CO2-equivalent per kWh in recent years, varying by year.

Captive gas turbine: natural gas combustion. Approximately 0.45-0.55 kg CO2-equivalent per kWh depending on efficiency.

Captive diesel generators: diesel combustion. Approximately 0.70-0.85 kg CO2-equivalent per kWh. Significantly higher than grid or gas.

On-site solar: zero direct emissions during operation. If additionality is established (the solar represents incremental renewable generation), a significant portion of Scope 2 can be zeroed.

A mill that runs diesel generators for 6-8 hours per day during load shedding has a higher actual Scope 2 emission factor than the national grid average would suggest. A GHG inventory that only accounts for grid electricity consumption and ignores diesel backup generation is understating emissions. This is the specific accuracy gap that verification of GHG inventories catches.

What this means for buyers building CSRD Scope 3 data Your Pakistani supplier's GHG inventory, if they have one, should account for all electricity sources: grid, gas turbine, diesel backup, and solar. A supplier who provides only grid electricity consumption data and ignores captive generation is providing incomplete GHG data that understates their actual Scope 2 emissions.

A buyer who incorporates this incomplete data into their CSRD Scope 3 Category 1 calculation is reporting lower supply chain emissions than are actually occurring. This is the type of data quality issue that statutory auditors are trained to probe: "how did you verify that your supplier's GHG data covers all electricity sources including backup generation?"

The answer needs to be: the data was verified by a third-party GHG inventory verifier who reviewed actual fuel purchase records, electricity meter readings, and production data to confirm that all emission sources were captured. That's what a properly verified GHG inventory provides.

The improving picture and what it means for long-term sourcing

Pakistan's grid situation is improving. Through 2025 and 2026, the combination of new renewable capacity, structural reform in the electricity sector, and improved transmission management has reduced load shedding frequency and duration relative to the 2022-2023 peak.

More importantly, the investment economics of on-site solar generation in Pakistan have become very favorable. Declining solar panel costs, rising grid electricity tariffs, and availability of green banking financing have made on-site solar installation financially attractive for medium and large industrial facilities without requiring a sustainability motivation. The business case works on energy cost alone.

Pakistani mills that install on-site solar are simultaneously: reducing their operating cost (solar generation is cheaper than grid or diesel), improving their production stability (reducing dependence on grid interruptions), and improving their GHG performance (reducing Scope 2 emissions). All three benefits are genuine and compound over the installation's lifetime.

For CSRD Scope 3 accuracy, buyers who encourage their Pakistani suppliers toward solar installation, through supply commitments that support capital investment decisions, through directing suppliers to SBP green banking programmes, or through sustainability-linked purchasing terms, are simultaneously improving the accuracy of their own Scope 3 data and reducing their supply chain's carbon intensity.

For verified GHG inventory with complete energy source accounting, contact Tti Labs Sustainability Center at sustainability@ttilabs.net.