Pakistan to Revise Rooftop Solar Buyback Policy for Fairer Energy Distribution

The government is set to revise the current rooftop solar buyback tariff, moving from the net-metering system to a gross-metering framework. This shift comes after the existing policy reportedly placed an Rs103 billion burden on grid users, with wealthier households gaining more from lower-cost electricity.

Under the new policy, the national grid will buy electricity from rooftop solar users at Rs8-9 per unit, a significant drop from the current Rs21 per unit. This change is expected to extend the payback period for solar system investments from 18-24 months to around 4-5 years.

Currently, under the net-metering system, solar users can sell excess electricity back to the grid at Rs21 per unit but must repurchase it at Rs42 per unit during periods of low generation, such as at night. This arrangement has allowed wealthier consumers to recover their solar system costs quickly, while the financial burden has been passed on to grid-only users. Documents from the Power Division show that this policy has raised electricity rates for low-income consumers by Rs1.03 per unit.

The new gross-metering system will require solar consumers to sell all generated electricity to the grid at reduced rates, preventing them from receiving zero electricity bills. This differs from net metering, where users meet their energy needs with solar power and only export the surplus.

The Power Division has reported a surge in net-metering installations, with solar capacity increasing from 321 MW in 2021 to 3,277 MW in 2024. The number of net-metering users has grown to 226,440, making up 0.6% of the total 37 million electricity users. If left unchecked, officials warn this trend could result in a Rs503 billion burden on the system over the next decade.

Cities like Lahore, Karachi, Islamabad, and Faisalabad make up 80% of net-metering users, with many residing in more affluent neighborhoods. The current policy has allowed these consumers to reduce their electricity bills by as much as 35% each month, while shifting costs to non-solar users.

Energy experts have called for a more balanced system, stressing that while solar energy should remain accessible, tariffs should reflect the declining cost of solar panels to prevent exploitation. The National Electric Power Regulatory Authority (NEPRA) has been urged to adjust rooftop solar rates in line with market trends.

The government aims to finalize the new policy by February, with plans to create a more sustainable framework for rooftop solar integration, ensuring that lower-income and underprivileged consumers aren’t burdened by the current system