This study conducts a comprehensive investigation into prospective policy alternatives within Pakistan’s power sector using the PAK-TIMES model, targeting the critical challenges of energy scarcity and environmental degradation. Focused on the period from 2022 to 2050, the research evaluates the impact of various policies on energy consumption, supplies, carbon emissions, and expenditures in alignment with Pakistan’s Nationally Determined Contributions (NDC) directed at combatting climate change. The study explores three distinct scenarios: a business-as-usual (BAU) scenario, along with five policy (5% Eff, 10% Eff, 15% REN, 30% REN, 50% REN) scenarios categorized into energy efficiency and renewable integration. The first scenario concentrates on the deployment of energy-efficient devices, while the second scenario delves into diverse levels of renewable energy integration. Key results reveal that energy demand is projected to surge substantially under the BAU scenario, increasing significantly from 3459 PJ in 2022 to 7912 PJ by 2050. In contrast, scenarios prioritizing energy efficiency can potentially curb the total energy supply by 2.3%, while renewable energy integration can expand up to 1.3% compared to business-as-usual by 2050. These alternative scenarios also exhibit the potential to slash greenhouse gas (GHG) emissions from the power sector by up to 15%. Notably, the PAK-TIMES model emerges as a valuable decision support tool for the Pakistani government to facilitate the execution of energy efficiency and renewable energy policies aimed at fulfilling its NDCs, while also contributing to the fulfillment of Sustainable Development Goals (SDGs) 7 (affordable and clean energy) and 13 (climate action). The study underscores the pivotal role of policy interventions in simultaneously mitigating energy challenges and combatting climate change for sustainable development.