Govt revises solar net metering rules, removes relief on excess power

ISLAMABAD: The federal government has revised the billing mechanism for solar power users, removing financial incentives on excess electricity generated and fed into the grid.

Under the new policy, surplus electricity supplied by consumers to distribution companies will be treated as zero units, effectively ending relief previously available under the net metering system.

The government has also introduced an “export MDI check”, which applies to consumers generating electricity beyond their approved capacity.

The move means electricity produced from additional, unapproved solar panels will no longer qualify for any financial benefit, even if it is added to the national grid.

Relief on excess generation has also been withdrawn based on export meter readings.

Separately, the National Electric Power Regulatory Authority imposed fines totalling Rs60 million on the Central Power Purchasing Agency and the National Grid Company over irregularities linked to fuel cost adjustments in January 2024.

In its ruling, the NEPRA said the average fuel cost for that month stood at Rs14.60 per unit, significantly higher than the benchmark of Rs7.49 per unit. A fuel price adjustment of Rs7.13 per unit had been sought, while electricity was ultimately made Rs7.05 per unit more expensive.

The regulator said expensive electricity generated from furnace oil and diesel was prioritised over cheaper sources such as LNG and nuclear power, leading to higher costs.

Power worth over Rs31 billion was generated using diesel and furnace oil during the period.

The NEPRA fined CPPA Rs10 million for failing to justify the cost increase, while the National Grid Company was fined Rs50 million for delays in developing transmission infrastructure, which hindered the use of cheaper electricity from local coal projects.

The NEPRA has directed both entities to deposit the fines to the national exchequer within 15 days.