Pakistan's Power Regulator Moves To Curb Solar Energy

Pakistan, cited for a surprising boom in solar installations that surprised even its own government, has now been forced to act against the same effort by its citizens. The solar boom, a consequence of irregular power and power prices that crossed PKR 70 for most segments,  has led to a worsening of the situation for the national grid, and the associated 'circular debt' that has plagued it for over a decade, as paying customers dropped off the grid, powered by solar.  The regulator, the National Electric Power Regulatory Authority (Nepra) acted on Feb 9 , changing the terms of contracts for all existing and future net-metered solar consumers — known as prosumers. The move is a clear effort to protect the failuing state owned power network, and is likely to cause widespread resentment among the millions of opeople who added solar to manage. There have been wide variations between official figures of solar installations, and actual solar installations on the ground, as government figures have failed to account for consumers dropping off the grid, fed up with high cost, undependable power, or behind the meter connections installed by many small industries.  

Pakistan currently is estimated to have over 7 GW of grid connected solar , and 13 GW of off grid solar. The government claims that millions have gone with hybrid systems without informing the power distribution firms to avoid missing subsidies, creating  serious grid imbalance and shrinking demand. With over 60 GW of modules imported in 2025, it is anyone's guess what the size of this hidden solar market is.   

Changes Rammed Through

NEPRA's contractual changes were introduced through a notification that effectively terminates the existing net-metering regime and replaces it with net-billing for all.

The new regulations clarify that existing registered prosumers will be shifted immediately to net-billing instead of net-metering, and their export units will be credited for one month only instead of the current three months. All other existing terms will remain unchanged until expiry of their seven-year contracts. The changes will come as a shockl to consumers who had managed to get assurances from miniusters and oficicials earliet that their net-metering contracts would not be tionkered with for the contract duration.  The issue of challenging the new regulations will possibly go to court, although in the new hybrid regime that posses for democracy there, respote may not be forthcoming for consumers.  

Lower Tenure, Lower Payments
New prosumers will be granted only five-year contracts from the seven year contracts earlier.  Units exported to the grid will earn just Rs11 per unit compared to Rs26 currently. Even as the cost of units imported will vary between Rs 40-60 approximately, severely reducing the incentive to go for solar. Or perhaps, increasing the case even more for solar plus storage solutions alonmg with a diesel genset while going off grid. 

The new rules are seemingly being rammed through despite protests, as many reports claim Nepra's public hearing didnot allow other stakeholders to offer or opresent their alternative options.