Solar Users to Pay Full Electricity Unit Price Under Latest Net-Billing Rule

Islamabad: In a major policy shift aimed at restructuring the country’s power sector, the government has announced a new net-billing mechanism that will require solar energy users to pay the full electricity unit price for power consumed from the national grid. The move replaces the long-standing net-metering system and has sparked widespread debate among consumers, industry experts, and renewable energy advocates.

According to officials familiar with the development, the revised policy is designed to address financial imbalances in the power distribution system while ensuring long-term grid sustainability. Under the new framework, electricity generated by rooftop solar systems and exported to the grid will be purchased at a lower rate, while any electricity imported from the grid will be charged at prevailing retail tariffs.

From Net-Metering to Net-Billing

For more than a decade, net-metering served as a cornerstone of Pakistan’s renewable energy push. The system allowed solar users to offset the electricity they consumed with the power they generated, effectively reducing or eliminating monthly electricity bills. Excess units produced during the day could be used at night, making rooftop solar an economically attractive option for households and businesses alike.

The newly introduced net-billing system fundamentally changes this arrangement. Under net-billing, imported and exported electricity are treated as separate transactions. Solar consumers will now be billed at the full electricity rate for units drawn from the grid, while surplus power exported will be credited at a predetermined energy purchase rate, which is significantly lower than retail prices.

Officials say the change reflects evolving realities in the power sector, particularly the rapid rise in distributed solar generation.

Why the Policy Was Introduced

Government sources indicate that the decision was driven by mounting financial pressure on power distribution companies (Discos). As solar adoption increased, a growing number of high-consumption users reduced their grid dependency, shifting the cost of grid maintenance onto non-solar consumers.

“The previous system created an imbalance where grid infrastructure was being used without proportional contribution,” an energy ministry official said on condition of anonymity. “Net-billing ensures fairness by requiring all users to pay for the electricity they consume from the grid.”

Policymakers argue that while solar energy remains vital for reducing fuel imports and emissions, its integration must not undermine the financial stability of the power sector.

Impact on Solar Consumers

Under the new policy, solar users will face noticeable changes in their monthly electricity bills. Even households that generate substantial solar power may still receive a bill if they rely on the grid during evenings or cloudy periods.

Key implications include:

Full retail tariff applied to all imported electricity units

Lower compensation for surplus solar energy exported to the grid

No one-to-one unit adjustment, as practiced under net-metering

Energy analysts believe this will lengthen the payback period for rooftop solar installations, especially for users without battery storage systems.

“Solar will still save money, but the savings won’t be as dramatic as before,” said an independent energy consultant. “Consumers will need to rethink system sizing and usage patterns.”

Battery Storage Likely to Gain Popularity

With export rates reduced, experts predict a surge in demand for battery storage solutions. Instead of selling excess power to the grid at a low price, users may prefer storing energy for later use, reducing reliance on expensive grid electricity.

Hybrid solar systems that combine panels with batteries are expected to become more attractive, though higher upfront costs may deter middle-income households.

Industry insiders believe this could lead to innovation in energy storage financing and leasing models to keep solar adoption viable.

Reaction from the Solar Industry

The solar industry has responded with mixed reactions. While some stakeholders acknowledge the need for regulatory reform, others fear the policy could slow down renewable energy growth.

“This decision sends the wrong signal at a time when clean energy adoption should be accelerated,” said a representative of a solar installers’ association. “Many people invested in solar expecting stable policies. Frequent changes hurt investor confidence.”

Small-scale installers, in particular, worry about declining demand, while larger energy firms are already adjusting their business strategies to focus on storage and energy management services.

Environmental and Economic Concerns

Environmental advocates argue that discouraging rooftop solar could increase dependence on fossil fuels and imported energy. They stress that distributed solar reduces transmission losses, lowers emissions, and enhances energy security.

Economists, however, point out that subsidizing solar exports at retail rates was never sustainable. “Every policy has winners and losers,” said a senior economist. “The challenge is finding a balance between encouraging clean energy and maintaining a financially stable grid.”

What Happens to Existing Solar Users

Authorities have clarified that existing agreements under the old net-metering framework may remain valid for a limited period. Once those contracts expire, users will be transitioned to the net-billing system.

New solar connections will automatically fall under the revised rules, making it essential for prospective buyers to reassess the financial feasibility of installations before investing.

A Defining Moment for Energy Policy

The introduction of net-billing marks a turning point in Pakistan’s energy policy. While it may reduce short-term incentives for rooftop solar, policymakers believe it will lead to a more balanced and resilient power system in the long run.

As the country navigates rising energy demand, fiscal constraints, and climate challenges, the success of this policy will depend on how effectively it aligns consumer interests with national energy goals.

For now, solar users are left recalculating their energy strategies in a landscape where clean power remains valuable—but no longer comes with a free ride on the grid.