Gross-metering policy: A tug of war between grid users and solar owners

Electricity consumers with rooftop solar installations may be struck hard as Islamabad is preparing to replace the existing net-metering system with a gross-metering system. According to reports, the rooftop solar buyback tariff could be revised soon as net-metering has imposed a financial burden of 103 billion rupees on grid consumers.

If Islamabad approves the proposed policy, users of the national grid will buy electricity from rooftop solar power producers at approximately eight rupees per unit. The proposed price will be 160 percent lower as the current price that net-meter owners get is 21 rupees per unit.

The move will significantly hurt users who have installed solar panels in the past few months as it will take approximately five years to recoup the investment amount. For reference, the time frame to breakeven on solar investments under the current policy is just 18-24 months.

Under the current system, net-meter owners provide excess electricity to the national grid for 21 rupees per unit and buy it back at 42 rupees per unit. This has disproportionately benefitted households with large solar panel installations as they consistently provide more power to the grid compared to their consumption.

As per reports, this has resulted in a shifting of costs to those who do not have solar installations. Documents from the Power Division have revealed that under the current policy, tariffs have increased for underprivileged consumers by over one rupee per unit.

The proposed changes will implement a gross-metering system, which means net-meter holders will no longer be able to achieve zero electricity bills. This is because in a gross-metering system, power from solar panels must be routed to the national grid and must be bought back from the grid for consumption.

The current policy is favorable for net-meter owners as consumers are allowed to divert power from their panels to household consumption and only export surplus power to the grid. This mechanism allowed for solar users to consistently witness zero or extremely low electricity bills.

Data from the Power Division revealed that solar capacity rose from 321 Megawatts in 2021 to 3,277 Megawatts by 2024. This rise has been witnessed because of an increase in net-metering connections.

Currently, there are 226,400 net-meter owners in Pakistan which translates into just 0.6 percent of electricity users. Analysts fear how high tariffs on underprivileged consumers could rise because of the rising trend of solar power adoption.

Officials have warned that the financial burden on grid users could cross half a trillion rupees over the next decade if regulations are not passed. Islamabad will finalize a plan to tackle the ‘problem’ of net-metering and rooftop solar plants by February.