Solar net-metering, as proposed by Pakistan's power minister, could potentially escalate the nation's electricity expenses.
In a recent development, Pakistan's Prime Minister Shehbaz Sharif has directed further cuts in electricity prices, aiming to make energy more affordable for its citizens. This move comes as part of a broader strategy to transition the country towards renewable energy sources.
Pakistan has set ambitious goals for itself, aiming to achieve 60% renewable energy by 2030 and reduce projected emissions by 50%. To this end, the country's ideal climatic conditions for solar power generation, with most parts receiving over nine hours of sunlight daily, make it an excellent candidate for solar energy adoption.
However, the current solar net-metering policy, approved in 2017 to promote solar energy, has been under scrutiny. The policy allows homeowners and businesses to generate power using solar panels and export excess energy to the national grid. As of January 2023, around 0.6% of total electricity consumers are net-metering users, with 80% belonging to affluent areas of major cities.
At a press conference in Lahore, Pakistan's Power Minister Sardar Awais Leghari called for revising the existing net-metering system, stating that it has become unfeasible for the government. Leghari also pointed out that the remaining 99.4% of electricity consumers bear the burden of the net-metering costs in Pakistan.
The subsidy burden for the net-metering policy falls on the government and other consumers to benefit affluent households with solar panels. Currently, the net-metering policy pays Rs21 per unit for surplus solar power, including a Rs1.90 subsidy. Sardar Awais Leghari has warned that the continued use of solar net-metering could add an extra burden of Rs3-4 per unit on consumers.
Despite a recent surge in solar power adoption, Pakistan remains far behind in achieving its renewable energy goals. To address this, the energy ministry is exploring different options to achieve the reduction in electricity prices. Utilizing just 0.071% of Pakistan's land area for solar photovoltaic (solar PV) power generation could meet the country's electricity demand.
The promotion for changing the solar net-metering regulation in Pakistan comes from relevant energy policy stakeholders and regulatory authorities, with discussions taking place around 2025. The exact timing for such a change could be expected within this year or shortly thereafter as part of ongoing energy sector reforms.
As of January 2023, the energy ministry in Pakistan has stated that 200,000 to 300,000 people could benefit from the continued use of solar net-metering. With the anticipated revision of the policy, it is hoped that more citizens will be able to harness the benefits of renewable energy and contribute to Pakistan's ambitious renewable energy goals.
In the meantime, the number of consumers receiving a 70% discount on electricity has increased from nearly six million to around 18 million. This initiative, alongside potential changes to the solar net-metering policy, demonstrates the government's commitment to making energy more accessible and affordable for its citizens.
