Federal govt to reduce solar net metering rates across Pakistan

ISLAMABAD: The federal government is considering a significant reduction in the solar net metering rate, from the current Rs. 21 per unit to Rs. 7.5-11 per unit.

This follows the recent drop in prices for solar panels, and based on the International Monetary Fund (IMF) worries that increased solar energy use will mean reduced use of the grid.

If this is approved, rooftop solar users will be compensated less for the excess electricity that they feed into the grid, whereas they will pay Rs. 60 per unit of grid electricity during peak consumption hours.

This development could hamper the further installation of solar panels as, for instance, six units of solar panels may only be equivalent to one unit of grid electricity.

Capacity Payment Policy

The government is also reasonable in trying to adjust the capacity payment policy levels where power generators have oversupply while the demands for the grid power are low.

This particular decision by the government is also prompted by a recent solar competitive bidding by K-Electric which was at 3.1 cents per unit.

These tariffs will also be forwarded to NEPRA, National Electric Power Regulatory Authority for their approval. The IMF raised a red flag regarding the grid considering itself a free solar battery for users of solar energy and recommended increasing the appetite for grid electricity.

Alternatively, it has been suggested that gross metering be introduced, under which solar users would receive a fixed price per unit for all energy supplied to the grid while they would pay retail prices for any energy availed from the grid. This aims not only to promote green energy usage but also to look after the health of the national grid.