In a major step toward aligning Pakistan’s industrial base with global climate objectives, the World Bank has outlined a comprehensive decarbonisation and energy efficiency roadmap targeting five of the country’s most energy-intensive sectors. The recommendations, published in a new report titled Pakistan Energy Efficiency: Industrial Energy Efficiency and Decarbonisation (EE&D), aim to support national energy cost management while enabling climate-aligned growth.
The report, which draws on research conducted from mid-2022 to 2023, focuses on the cement, steel, fertiliser, textile, and paper and pulp industries. These sectors collectively represent a significant portion of Pakistan’s energy consumption and greenhouse gas emissions. The World Bank’s strategy calls for tailored interventions to improve energy use, reduce emissions, and promote long-term industrial resilience.
While acknowledging that some companies have already adopted energy-efficient technologies, the report flags several barriers that limit broader implementation. These include information gaps, inadequate access to financing, and regulatory hurdles. It also identifies a key perception issue: many firms associate energy-efficient and decarbonisation initiatives with increased operational costs and reduced competitiveness, particularly when framed under the term “decarbonisation” rather than “efficiency.”
In the textile sector—the country’s top industrial export—the dyeing and finishing stages were identified as the most energy-intensive. Suggested interventions range from fuel switching and electrification to integrating circular economy principles and advanced technologies. According to the report, implementing these measures could cut energy consumption by 50% to 60%, with a corresponding emissions reduction of up to 13%.
Pakistan’s cement industry, which has already begun experimenting with alternative fuels and waste heat recovery systems, also holds room for improvement. The report estimates that expanding current initiatives and introducing new technologies could reduce emissions by 3% to 35% and energy use by 6% to 20%.
In the fertiliser industry, where fixed low gas prices have discouraged investment in energy upgrades, the World Bank highlights the risk posed by reliance on natural gas. Volatility in fuel pricing has left the sector financially exposed and slow to adopt more efficient production methods.
For the steel sector—predominantly operating through electric induction furnaces—the roadmap suggests that additional investment could yield energy reductions of 8% to 10% and emissions cuts between 5% and 12%. The report encourages clearer communication of cost-saving opportunities to encourage broader adoption among firms.
Meanwhile, the paper and pulp sector, which has been expanding at a rate of 7.2% annually over the past five years, has made limited progress in energy efficiency. The World Bank recommends scaling up modern technologies to improve energy performance and reduce operational overhead.
The report is intended to feed into ongoing policy discussions between the World Bank Group and the Government of Pakistan. It emphasizes the need for coordinated policy reform, targeted incentives, and accessible financing to make industrial decarbonisation both practical and economically viable.
By providing sector-specific solutions grounded in current industrial realities, the roadmap offers a realistic framework for reducing emissions without compromising competitiveness—crucial as Pakistan seeks to balance industrial growth with environmental responsibility.