Net Metering Rates Revised? PSA Concerned Over Changed Net Metering Policy

Severe energy and economic crises in Pakistan have already challenged the nationals to sustain a normal lifestyle. With increased electricity tariffs, people in Pakistan started investing their lifelong savings into solar power to release themselves from high electricity bills.

However, the country faces a mounting payment crisis due to the increased number of Independent Power Producers. As per a report from a renowned news channel in Pakistan, the increased capacity charges have ramped up the power production cost, resulting in inflated electricity bills.

In an emergency cabinet meeting held in August, the Caretaker Prime Minister Anwaarul Haq Kakar highlighted that the government will be paying an increased amount of 2,000 billion PKR in capacity payment next year. 

Also Read: What is Net Metering? A Detailed Overview

The government is blaming IPPs for inflated capacity payments, saying that at least 1,000 megawatts of energy is produced by the solar power systems owned by consumers, which they sell to national grids.

In contrast, solar power consumers are unsatisfied with the rate at which they sell electricity to the utility. As per them, the government is buying solar-generated power at a meager price and selling it to WAPDA consumers at a significantly high cost.

The current net metering power tariff is  PKR 19.32 per kilowatt hour. However, the national grid sells electricity at (price) per unit. 

The government believes that the 1000 megawatts of energy generated and sold by solar consumers costs NEPRA more than PKR 19.32 per unit. NEPRA is also facing challenges due to capacity payments to IPPs. 

MD of the National Energy Efficiency Authority, Sardar Moazzam, recently told a local news channel that revising net metering rates is only a proposal and has yet to be implemented. 

Pakistan Solar Association, PSA showed concerns over persuasive alteration in net metering policy. 

In a press conference held on September 5, 2023, PSA Chairman Amir Chaudhry underscored the problem that causes a shortfall in the revenue collection of DISCOs. According to him, the rampant energy theft is causing a continuous increase in circular debt.

In February, the Power Division Secretary Rashid Mehmood Langrial reported that electricity worth Rs 380 billion is stolen annually. He also mentioned that net metering is a sustainable energy solution that allows individuals to generate power and contribute to the national grid.

On September 11, 2023, the caretaker government mentioned that they had no intentions to reduce net metering incentives. The Caretaker Minister for Energy and Petroleum, Muhammad Ali, said that the government supports solar power generation and will introduce a special tariff for electricity consumers before October 31, 2023. He further mentioned that the government is taking strict measures against electricity theft.

Also Read: Consumer Feedback on Solar Systems & Net Metering in Pakistan