Pakistan is a developing country that is experiencing a shortage of electricity generation due to its rapidly growing demand. The existing and upcoming energy requirements for power generation and future transportation can be met by efficient utilisation of homegrown biomass resources. Determining the present energy mix resources in various sectors of the country is important. This article analyses the biomass resources and their potential and bioenergy utilisation in Pakistan. An overview of the global renewable energy scenario is presented. This article accentuates the importance and challenges of new technologies and estimates the current and future share of power generation from renewable sources, focusing on the technical potential of biomass energy, which is obtained from agricultural residues, animal manure and municipal solid wastes in Pakistan. This paper highlights the developing technologies that are primarily used to convert biomass waste into energy and presents a critical consideration on future directions in drafting the bioenergy framework policy in Pakistan. For effective implementation of biomass-based renewable energy production in the country, this paper presents an extensive literature review on current and future perspectives and suggestions on future directions and policies to overcome the deficit in electricity supply and environmental concerns. Furthermore, this paper discusses the utilisation of biomass resources in the rapidly growing transportation sector and presents a solution for upcoming mass transit projects in two major cities in Pakistan. The conclusion is that biomass energy is the most sustainable, eco-friendly and efficient renewable energy and is an emerging renewable energy resource that can meet the growing energy demand in Pakistan.