PM Shehbaz Orders NEPRA to Reduce Solar Net Metering Rates

Prime Minister Shehbaz Sharif has ordered the National Electric Power Regulatory Authority (NEPRA) and the Power Division to revise net metering rules to rationalize buyback rates. The Power Division in a recent meeting with Shehbaz sounded alarms about the financial impact of massive net metering by consumers, giving the ministry no other choice but to reduce the buyback rates to Rs. 11-12 per unit, reported Business Recorder. The International Monetary Fund (IMF) is insisting on full-cost recovery of electricity from consumers. The meeting decided that the Power Division would fine-tune and present a summary on converting the net metering regime to gross billing, creating a separate tariff category, revising buyback rates, amending net metering regulations, and developing a dynamic formula for a reasonable pay-back period. Following the discussion, the Prime Minister directed the Power Division and NEPRA to approve the necessary amendments to net metering regulations, with final recommendations to be completed by May 31, 2024. This comes as a significant number of electricity consumers have adopted solar power to escape load shedding and high electricity costs. The industrial and commercial sectors are also shifting towards solar. The rise in net metering has alarmed the Power Division and distribution companies, whose revenues have been declining. The Power Division reported that solar panels capable of generating 6,000 MW were imported in the first nine months of the current fiscal year.