Pakistan’s Economic Coordination Committee (ECC) has rolled out a significant policy shift for net metering consumers, slashing the electricity purchase rate from Rs27 per unit to just Rs10 per unit. This decision, aimed at easing the financial burden on regular electricity consumers, is set to dramatically extend the time required for net metering users to recover the cost of their solar systems.
The new policy comes in response to the rapid rise in solar panel installations across homes and offices, fueled by frequent power outages and skyrocketing electricity tariffs. Official data reveals that the number of net metering consumers is projected to climb to 283,000 by the end of 2024, up from 226,440 in October. Meanwhile, solar net metering capacity has surged from 321 MW in 2021 to 3,299 MW in October 2024, with an expected rise to 4,124 MW by December. New Net Metering Policy in Pakistan
However, this growth has shifted a hefty financial load onto non-net metering consumers. The government estimates that, by December 2024, net metering users will have imposed an additional Rs159 billion burden on the broader electricity consumer base. Without policy intervention, this figure could balloon to Rs4.24 trillion by 2034.
Under the revised framework, the government will now buy excess electricity from net metering consumers at Rs10 per unit—a steep drop from the previous Rs27—while allowing imports during peak hours at Rs60 per unit, inclusive of taxes. Government officials argue that this adjustment addresses the imbalance caused by net metering users, who are exempt from capacity payments and fixed charges levied by distribution companies.
Prolonged Payback Period Sparks Concerns
Energy experts have voiced apprehension over the policy’s implications. Rao Amir Ali, an analyst at Arif Habib Limited, warned that the reduced rate could deter adoption of net metering systems. “Previously, consumers could recover their solar system costs in three to four years,” Ali explained. “Under the new policy, that timeline stretches to 10 to 12 years, undermining the financial incentive for going solar.”
The shift has ignited debate about its impact on Pakistan’s renewable energy goals. Critics argue that discouraging net metering could slow the transition to cleaner energy, even as the country grapples with persistent energy shortages.
A Policy for Equity?
The government defends the change as a necessary step to restore fairness in the power sector. A spokesperson highlighted that net metering has disproportionately benefited wealthier households, with 80% of users concentrated in affluent areas of Pakistan’s nine largest cities.“This policy alleviates that strain and ensures a more equitable electricity distribution system.”
Still, the decision raises questions about the future of solar energy adoption in Pakistan. With the new rate structure, prospective net metering consumers may think twice before investing in solar systems, potentially stalling the momentum of a sector that has seen exponential growth in recent years.
As Pakistan navigates its energy challenges, the revised net metering policy marks a pivotal moment for the nation’s electricity landscape—one that could reshape the balance between renewable energy growth and economic equity for years to come.
