By Staff Reporter
ISLAMABAD: The federal cabinet on Wednesday mandated a thorough review of controversial changes to the country’s solar net metering policy, responding to widespread criticism from consumers, traders, and even senior government figures.
Prime Minister Shehbaz Sharif emphasized the need for extensive stakeholder consultations before finalizing revisions, signaling a pause on the rollout.
The revisions, initially approved by the Economic Coordination Committee (ECC) on March 13, slashed the buyback rate for surplus solar power from Rs27 to Rs10 per unit and axed net billing for new net-metering customers.
The decision sparked outrage, with Petroleum Minister Ali Pervez Malik warning it could stifle renewable energy uptake, and former Finance Minister Miftah Ismail slamming it as a driver of unaffordable electricity costs.
In response to the backlash, the cabinet has decided to broaden consultations on the policy, seeking input from all stakeholders before resubmitting recommendations to the ECC.
During a Wednesday cabinet meeting, Sharif ordered officials to engage all relevant parties and resubmit updated proposals to the ECC. He stressed that renewable energy remains a government priority, directing clarity through data to counter any misperceptions about the policy’s intent, affirming no change in the solar energy policy.
The ECC’s changes set the purchase price of excess solar power at Rs10 per unit, while grid electricity is sold at Rs42 per unit off-peak and Rs48 per unit during peak evening hours, excluding additional taxes. New rules also cap solar installations at a consumer’s sanctioned load plus a 10 percent buffer—down from a prior 50 percent allowance.
Existing net-metering users will shift to this model as their seven-year contracts expire.
Separately, the cabinet tackled rising electricity costs, approving relief measures funded by savings from renegotiated contracts with Independent Power Producers (IPPs) and adjustments tied to fluctuating global oil prices. In recent discussions with the International Monetary Fund (IMF), Pakistani officials outlined a plan to cut tariffs by approximately Rs2 per unit, leveraging these savings.
To amplify relief, the government is mulling a Rs10 increase in the petroleum levy on petrol and diesel, raising it to the Rs70-per-liter ceiling set by the Finance Act 2025. This could redirect revenues to shave an additional Rs2-2.50 per unit off power bills.
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