The government is preparing to introduce stricter rules for solar net metering users, revisiting reforms that were previously halted by Prime Minister Shehbaz Sharif after public backlash.
This time, the plan includes scrapping the zero-bill benefit and limiting consumers to a sanctioned load equal to their actual usage (1.0x instead of the current 1.5x), which would push many to switch to hybrid solar systems using lithium batteries.
Currently, solar users can sell surplus electricity back to distribution companies (DISCOs) at Rs27 per unit under the net metering system.
Under the proposed changes, this rate will be slashed to Rs10 per unit, and the entire concept of net metering will be replaced with “net billing.” This shift means energy exchange will no longer be unit-based but compensated at the reduced fixed rate.
Experts warn that the move could cost Pakistan around $1 billion annually due to increased lithium battery imports.
The proposal was discussed in a meeting led by the Power Division minister and attended by multiple stakeholders.
It also suggests ending the quarterly credit billing system and replacing it with a monthly cash settlement for excess power supplied to the grid.
However, the categories of eligible consumers, residential, commercial, and others, will remain unchanged.
Additionally, the licence term for solar net metering will be shortened from seven to five years.
Federal Minister for Energy Awais Ahmad Khan Leghari clarified that the government isn’t ending the policy but is instead aiming to reshape it for long-term sustainability.
He explained that the growing popularity of net metering is now affecting the grid’s balance and must be addressed.
“If we mention the purchase of units, then this is also being considered and there is talk of bringing it to the energy purchase price, so that the system automatically adjusts with fluctuations in rates. All these suggestions are under consideration,” he stated.
He added that reforms aim to ensure fair returns for solar users while protecting the power system.
“If a customer is consuming 40% of the electricity himself, the return of money in three years is an acceptable business model. These reforms are not a deterrent, but a step towards a better, balanced and sustainable system.”
The minister also outlined broader energy sector reforms, including cancelling 9,000 megawatts of costly, unnecessary projects and reintroducing captive power users to the grid through a levy.
He noted that cross-subsidies to industry since June 2024 have reached Rs174 billion, leading to a 31% cut in industrial electricity tariffs and higher consumption.