End of net metering? Major blow to solar panel users in Pakistan

Staff Report

ISLAMABAD: The federal government is poised to scrap the net metering system for solar energy consumers, as the Power Division finalises a new solar policy aimed at reshaping the country’s renewable energy landscape.

Sources in the Power Division said that the new solar energy policy has reached its final stages, with proposals already drafted for the implementation of gross metering in place of net metering.

The draft policy is expected to be submitted for federal cabinet approval after receiving a nod from the National Electric Power Regulatory Authority (NEPRA).

According to the proposed framework, the government plans to replace net metering with gross metering, setting a buyback rate of Rs11.33 per unit for electricity generated by solar panels and supplied back to the national grid.

However, solar users already enrolled in the current net metering system will not be affected by the change and will continue to sell electricity at the existing rate of Rs27 per unit.

Sources further revealed that the policy includes a mechanism to peg future solar buyback rates to one-third of the prevailing electricity tariff, making the Rs11.33 rate a baseline in the new system. The government aims to integrate up to 8,500 megawatts of solar-generated electricity into the national grid under the revised policy.

Officials within the Power Division argue that the net metering regime has placed an unsustainable financial burden on other electricity consumers, reportedly amounting to Rs159 billion.

Of this, Rs103 billion is attributed to the cost differential arising from higher purchase rates under net metering.

The Power Division believes that the shift to gross metering will help balance the system and create more equitable cost sharing.