ISLAMABAD: Prime Minister Shehbaz Sharif is said to have directed the National Electric Power Regulatory Authority (NEPRA) and Power Division to amend net metering regulations for rationalization of buyback rates, well-informed sources told Business Recorder.

The decision was taken at a recent meeting on power sector presided over by Prime Minister, which was attended by top officials of concerned authorities.

Currently, substantial number of electricity consumers, especially rich segment, has opted for solarization of their houses due to load shedding and expensive electricity. Industry and commercial consumers are also shifting to solarization.

Net metering power: Govt mulling bringing buyback rates down to Rs11/unit from Rs21

The current trend of net metering has jolted Power Division and Discos whose revenues is on the decline. The issue of massive solarization has also been discussed with the World Bank, Asian Development Bank (ADB) and now the IMF, who insists on full cost recovery of electricity from consumers.

The ADB in one of its recent aide-memoire stated that the Power Division expressed concerns regarding increasing net metering projects and their potential impact on Discos. The ADB argued that although its proposed program will primarily focus on off-grid areas, the Mission will consult with the Power Division as the program preparation progresses.

Govt’s balancing act: incentivise solar, but not too much?

The sources said the Power Division has placed its case of massive net metering before the Prime Minister along with its financial implication on revenues of Discos, which is already below target. Power Division has revised buy back rates at Rs 11 or 12 per unit instead of currently applicable rate of Rs 21 or Rs 22 per unit.

The meeting decided that Power Division will move a summary after fine-tuning the following elements of rationalization: (i) conversion of existing net metering regime to gross billing (separate rates for import and export of units; (ii) creation of separate tariff category;(iii) revision of buy back rates; (iv) amendment of net metering regulations; and (v) a dynamic formula to determine a reasonable pay-back period.

After discussion Prime Minister directed Power Division and NEPRA to approve amendments to net metering regulations. Power Division will take lead in this issue to finalize recommendations by May 31, 2024.

Amid high tariffs, Pakistan’s industrial base is ramping up transition to solar power

The Power Division, sources said, in its presentation to Prime Minister noted that solar panels have been imported to the tune of 6,000 MW during the first nine months of current fiscal year as Chinese PV panels are available at very cheap prices.

The Sindh Energy Department has requested ADB support in the following priority areas identified by the Sindh Government: (i) mini grid solutions for rural underserved areas; (ii) a new solarization initiative aimed at bringing electricity to the remotest and most underprivileged regions of Sindh; and (iii) solarization of reconstructed houses in flood-affected areas.

The ADB maintains that the nature of the Sindh Government’s request is aligned well with the objectives of the Second Access to Clean Energy Investment Program. The Mission and the Sindh Energy Department have agreed to pursue the program, including the development of sustainable business models.

Copyright Business Recorder, 2024

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Comments

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Tariq Qurashi May 16, 2024 09:15am
This will be very bad for Pakistan in the long run because people will stop installing Solar panels, and instead the country will go back to buying expensive electricity from the IPPs. with dollars.
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KU May 16, 2024 10:43am
What a state of primates doing what they do best, so Rs.65 per unit is acceptable but Rs.20 per unit is a threat? When is the govt banning solar energy in Pakistan?
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Arshad May 16, 2024 12:35pm
THEY are only worried because most of the IPP are owned by the CORRUPT. Globally countries are going towards Green Energy, but since our priority is purchasing properties in Dubai. So we cannot let this happen.
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Haroon Aziz Khan May 16, 2024 12:44pm
SOLAR IS NOW AFFORDABLE TO ALL LOWER CLASS AS WELL.THEN WHY ALL SOLAR OWNERS COUNTED IN SAME CLASS? POOR PEOPLE INSTALLED SYS WITH THE HELP OF LOAN OR THEIR PENTIONS ETC. LET THEM LIVE PEACEFULLY
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patriot May 16, 2024 12:48pm
first GOP supported solarization by zero tax so ppl invested money by calculating earning on offered net metering rate now GOP deciding to reduce rate why higher rate was given to hurt power sector
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Mazher Naeem May 16, 2024 01:40pm
Stupidest decision by government, especially bureaucracy and power division, which will not crackdown on illegal connections, fake billing & electricity theft as that's their main source of income
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Usaid May 16, 2024 01:41pm
GoP is pushing to remove net meters and stop exporting to GoP, cutoff from grid, use solar in daytime, and install UPS/batteries and wind energy for evening requirements.
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wz May 16, 2024 01:43pm
if the govt is cutting buy back rates, it should only be done for non-filers, non-tax payers. the tax payer should have some benefit whether rich or not.
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Maqbool May 16, 2024 02:21pm
The provinces are going to gift 15,000 solar units free. GOP is allowing foreigners to set up solar plants. Why penalize Pakistan for putting the same solar, only to protect bijli thief’s and DISCO ?
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T May 16, 2024 02:23pm
stupidest creatures on the planet trying to act smart and failing, this is funny.
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Ali May 16, 2024 02:32pm
rich segment can afford electricity . Its the poor that are installing solar
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Ali May 16, 2024 02:34pm
People will install batteries if net metering is not favourable. This is a fight government cannot win
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Tariq Qurashi May 16, 2024 03:34pm
To reduce the solar net metering buyback rates will be a very bad political move for the present government because a lot of people have invested a lot of money in Solar.
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Usaid May 16, 2024 08:01pm
Let's cutoff from the grid and move to batteries and wind power. GoP doesn't deserve to be exported a single unit.
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Hassan May 17, 2024 11:57pm
First of all it's not net metering is net billing which only K-Electric doing it , we just want our units produced be adjusted against units consumed not amounts and ratio can be set for peak hrs
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