Cabinet delays approval of net metering policy

ISLAMABAD: The federal cabinet has postponed the approval of the net metering policy for solar energy users, halting the imposition of additional taxes on solar energy consumers. ARY News reported on Wednesday.

During the cabinet meeting, the Prime Minister instructed Energy Minister Owais Leghari to review the policy, citing concerns over its impact on clean energy adoption.

The Economic Coordination Committee (ECC) recently approved amendments to the net metering regulations, reducing the buyback rate for solar-generated electricity from Rs. 27 to Rs. 10 per unit.

This decision aimed to alleviate financial pressure on grid consumers but sparked backlash from solar users and industry stakeholders.

The revised net metering policy for solar energy users also proposed higher electricity rates for solar consumers, with off-peak rates set at Rs. 42 per unit and peak-hour rates at Rs. 48 per unit, alongside an 18% tax and additional duties.

The government clarified that the revised framework would not apply to existing net-metering consumers until their seven-year agreements expire.

However, the policy’s implications have raised concerns about discouraging solar energy adoption, particularly in urban areas where 80% of net-metering users reside.

Read more: Net metering policy: What solar system users need to know?

Historically, the Pakistan Muslim League (N) has championed solar energy as a means of providing relief to citizens, with promises to promote renewable energy dating back to 2015.

Recently, Punjab Chief Minister Maryam Nawaz announced a major solar initiative offering relief to consumers using up to 300 units. Yet, the government’s shift from encouraging to discouraging solar energy adoption within a year has left many questioning its commitment to renewable energy.

The net metering policy for solar energy users is currently under thorough review by the relevant authorities. As part of this process, extensive consultations and deliberations are anticipated to ensure the framework is meticulously refined.

The ultimate goal is to strike a balance that supports the adoption of clean energy while addressing the concerns of various stakeholders.