Govt to Resubmit Net-Metering Reforms Proposal to ECC, Proposes Sharp Cut in Solar Buyback Rate
The Power Division is set to resubmit its proposal to the Economic Coordination Committee (ECC) for amendments to the Net-Metering Regulations, aiming to cap solar energy contracts at five years and slash buyback rates from Rs. 27 to Rs. 10 per unit, according to a report by Business Recorder.
The proposal was initially approved by the ECC on March 13, 2025, but was deferred by the Federal Cabinet pending further consultation. With consultations now complete, the Cabinet Division has granted permission to move forward with resubmission.
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Why the Change?
The Power Division argues that net-metering caused a 3.2 billion kWh reduction in energy sales in FY24, leading to a Rs. 101 billion financial burden and a tariff increase of Rs. 0.9 per kWh for non-solar consumers.
Looking ahead, it projects that by FY34, net-metering could reduce sales by 18.8 billion kWh, potentially triggering a Rs. 545 billion cost impact and raising average power tariffs by Rs. 3.6 per kWh.
The proposal warns that such trends could distort least-cost power planning, as outlined in the Integrated Generation Capacity Expansion Plan (IGCEP) 2025, which includes 8,000 MW of net-metering-based solar capacity.
World Bank to Support Rooftop Solar Assessment
Separately, the Power Division has sought technical assistance from the World Bank for a comprehensive nationwide rooftop solar assessment. The Bank has agreed to support the initiative under its Electricity Distribution and Efficiency Improvement Project (EDEIP).
These reforms are part of the government’s broader strategy to manage financial sustainability in the power sector while balancing the growth of renewable energy. However, the drastic cut in buyback rates could stir significant debate among solar energy users and investors.
