The National Electric Power Regulatory Authority (NEPRA) is reviewing a significant change in Pakistan’s solar net metering policy, sources in the Power Division confirmed. The regulator is reportedly considering reducing the buyback rate for solar energy from the current Rs. 23 per unit to Rs. 10 per unit.
According to officials, NEPRA may also explore a future phase where the buyback mechanism is completely removed. In that scenario, consumers who generate solar power will not receive any payment for the excess electricity supplied to the grid. Instead, they will be required to consume all the power they produce.
Sources said that under the current system, solar power producers are collectively paid around Rs. 125 billion, adding pressure on the national grid’s financial sustainability. The Power Division believes that the existing buyback rates are contributing to rising electricity costs for other consumers connected to the grid.
Officials explained that as rooftop solar installations continue to grow, grid-based electricity consumption has dropped sharply. During fiscal year 2024 alone, grid sales declined by 3.2 billion units, causing an estimated Rs. 101 billion revenue loss to power distribution companies. This shortfall has reportedly led to an increase of nearly Rs. 1 per unit in electricity tariffs for non-solar users.
Power Division projections indicate that the financial impact could expand further over the next decade if the current policy remains unchanged. The shift toward solar power, officials warned, is creating challenges similar to those faced by the government in managing payments to Independent Power Producers (IPPs).
Following these developments, Prime Minister Shehbaz Sharif intervened on October 22, directing the Power Division and NEPRA to reassess the solar net metering policy. The review will focus on balancing affordability, energy sustainability, and fair compensation for consumers generating renewable energy.
The proposed reforms by NEPRA are expected to reshape Pakistan’s solar energy landscape, influencing future investments in rooftop solar systems and the broader renewable energy sector.
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