The federal government has presented a plan to the IMF mission, which is currently in Pakistan for an economic review under the $7 billion loan program, proposing a reduction in the purchase price of surplus electricity generated by rooftop solar energy systems.
At present, the government buys this excess solar power at Rs 27 per unit, but it is now considering lowering the rate to approximately Rs 10 per unit.
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However, the IMF has raised concerns regarding the government’s strategy for individuals who have installed solar panels but prefer to stay off-grid rather than connecting to the national grid.
Reports indicate that solar net metering has resulted in a financial burden of billions on grid-based consumers. There is speculation about ending net metering and imposing fixed charges on solar users, though the Power Division has denied such claims.
The IMF has expressed serious reservations, as the rapid rise in solar energy installations across the country is expected to increase significantly in the coming months and years, potentially impacting the electricity sector’s overall stability.
Meanwhile, the government has conveyed to the IMF that there is a pressing need to rationalize electricity tariffs.
Pakistan currently operates 104 power plants, of which 18 are government-owned and 86 are independent power producers (IPPs).
So far, the government has shut down five inefficient power plants and successfully renegotiated electricity rates with 14 IPPs.
Additionally, the government has reduced tariffs for eight IPPs utilizing sugarcane waste and is in the process of revising agreements with the remaining IPPs.
