Khyber Pakhtunkhwa Province (KP) is blessed with immense Hydro Power Potential due to its geography, natural bounty of number of main upstream rivers including Indus, Siran, Kunhar, Chitral, Panjkora and  wat. This potential remained focus of interest to private investors and international funding agencies. Most of the Hydel projects of Pakistan including the historical Tarbela and Warsak Dams are located in Khyber Pakhtunkhwa. The province has huge Hydro Power Potential due to existing rivers, gorges, river tributaries and canals with reasonable gradient; Landscape and V shaped valleys carved out by rivers. The landscape is ideal to build dams, tunnels and other civil works for Hydel power development project with stable positive cash fows, high rate of return, exemptions of income tax, withholding tax on import of machinery and turnover rate tax.

Pakistan has a hydro potential of about 60,000 MW of which only 6600 MW has been tapped with 3900 MW of hydel capacity  installed in KP Province.The Khyber Pakhtunkhwa has aggregate power potential of nearly 30,000 MW. Most of the hydel projects under development are in public sector, however, GoKP strongly believes in private sector participation. As a result, PEDO has been tasked to invite private sector to invest in power projects in KP.