The Pakistan Economic Survey 2023-24 gives the last official snapshot of net metering before the policy fight began in earnest. As of March 2024 there were 117,807 net-metered solar installations with a combined capacity of 1,822 MW, and more than 400 certified installers. By our division the average system is about 15.5 kW (1,822 MW over 117,807 sites). That is much larger than a typical household roof, which suggests the early boom is led by large houses, shops and factories with high sanctioned loads.
The same chapter lists the government's own solar plans: around 6,000 MW of utility-scale solar to displace imported fuels, about 2,000 MW of small plants on 11 kV feeders, and 1,000 MW on public buildings. Rooftop net metering is growing alongside all of this without any procurement at all.
Why the payback improved
The tariff side explains the speed. NEPRA's July 2024 decision raised the average residential tariff it determined from Rs26.06 to Rs35.24 per unit, roughly 35 per cent, while the industrial average fell slightly. For a household on upper slabs, each unit avoided or exported is now worth considerably more, and the payback on a rooftop system shortens in proportion.
The survey also notes that an online net-metering portal was redesigned and reactivated in IESCO and LESCO to process applications. Making connection easier while making grid power dearer is a combination that can only accelerate adoption.
Why the DISCOs are worried
Under the 2015 net-metering regulations, exported units are credited against imported ones. A prosumer who exports at noon and imports in the evening pays close to nothing for the grid's capacity and network, even though the grid still has to be sized for that evening import. NEPRA's July 2024 rebasing raised the average base tariff from Rs29.78 to Rs35.50 per unit, and most of the increase was power purchase cost, a large part of it fixed capacity payments. Every unit a large solar customer stops buying from the grid moves its share of those fixed costs onto the customers who cannot install panels.
The officials pushing to replace net metering with net billing have a point. Export credits at or near the retail rate pay prosumers far more than the energy their exports save the system, which is mostly midday fuel.
Our view
We think the case for reform is strong and the timing argument is being misused on both sides. Changing terms for existing contracts would damage trust in every future energy policy, and grandfathering existing agreements until they expire is the minimum. For new connections, credits linked to the energy purchase price, a fixed charge tied to sanctioned load, and limits on system size relative to that load are standard tools.
The bigger risk is the one officials talk about least. Hybrid systems with batteries that never export do not show up in net-metering data at all, and they reduce grid demand just as much. Cutting export credits will push more customers in that direction. A reform that only targets exports could speed up grid defection instead of slowing it.
Process matters as much as the rate. Net-metering rules are NEPRA regulations made under section 47 of the 1997 Act, which requires draft amendments to be published for public comment. Changes made that way, with a published estimate of the cost shift and of the savings to non-solar consumers, will survive. Changes announced through ministry briefings and then reversed by cabinet invite a rush of applications before every rumoured cutoff and leave the administrative backlog to the DISCOs.
DISCOs should publish verified net-metered capacity and exports every month. A 1,822 MW official figure from March is already out of date, and policy built on it will be behind the market before it is notified.
The equity argument is real. Households renting their homes, or living in flats, cannot install panels, and they are the ones left paying for the grid.