Government draws Senate criticism over net metering reversal

ISLAMABAD:

Treasury and opposition senators on Tuesday blasted the government over its new net metering policy, urging it to rein in independent power producers (IPPs) rather than penalize ordinary people who turn to solar power due to the energy crisis.

As the upper house resumed its session, Senator Zarqa Suharwardy introduced a resolution opposing the National Electric Power Regulatory Authority (Nepra) Regulations 2026 (prosumer).

The resolution asserted that the proposed framework could discourage citizen investment in rooftop solar and harm the country’s transition to renewable energy.

The electricity regulator has overhauled the country’s net metering regime, moving rooftop solar and other small generators to a new ‘net metering’ system under the NEPRA (Prosumer) Regulations, 2026, fundamentally changing the way power producers are paid and repealing the decade-old framework.

Under the new rules, notified by Nepra on Monday, utilities will be required to purchase excess electricity from prosumers – households, businesses and industries generating up to one megawatt – at the national average power purchase price, while selling the electricity back to them at the applicable consumer tariff, thereby ending individual net metering.

Senator Zarqa called for a transparent solar policy, accused IPPs of looting the country, demanded their closure and urged the government to develop policies that facilitate public welfare.

Speaking on the resolution, PTI Parliamentary Leader in the Senate, Senator Ali Zafar, said Energy Minister Awais Leghari had earlier told the Senate that the government was not withdrawing the solar policy, but was now doing just that.

He claimed that the IPPs had become a powerful mafia and said the government continued to pay them even when they were not producing electricity, calling it an injustice.

He accused the government of further oppressing poor citizens who had installed solar systems. He said Nepra was just following government directives and the law required the government to honor promises made even to ordinary citizens.

Zafar questioned which investor would invest in Pakistan if the government itself did not fulfill its commitments, and demanded that the Nepra chairman be summoned and imprisoned.

Speaking on the same resolution, PPP Senator Sherry Rehman said she supported the stand taken by Senators Zarqa Suharwardy and Ali Zafar.

She said Pakistan has the most expensive electricity in the entire region, while many government institutions fail to pay their electricity bills. She questioned whether the burden should then be placed on poor citizens.

She said Pakistan was purchasing fuel oil worth billions of dollars, while the electricity distribution system remained highly corrupt. Sherry accused the government of using electricity bills as a tax collection tool, imposing almost ten different taxes and surcharges.

She questioned why unexpected power cuts continued when excess electricity was available.

The senator warned that unemployment in Pakistan had reached 7 percent – ​​a level at which governments collapse – and said investors were leaving the country.

She added that she herself would not invest in Pakistan when the tariffs were being changed repeatedly.

Responding to criticism, Energy Minister Awais Ahmed Leghari reiterated that solar electricity costs between Rs 5 and Rs 6 per unit, questioning the fairness of buying it at Rs 27 per unit under net metering.

He said that out of 33.5 million electricity consumers on the national grid, only 466,000 used net metering and they could not be allowed to influence the majority.

He said there had been no change in Nepra’s net metering policy, only a regulatory adjustment, which had also been made in the past. Responding to PPP and PTI senators, the minister said the government and the ministry started engaging stakeholders 10-12 months ago.

He said even the solar association recognized the need for these changes to protect the public interest. He stressed that the role of NEPRA is to prevent unjustified increases in electricity prices and said the regulator had not changed any clause in consumer contracts.

He said the decline of the rupee against the dollar started during the PTI era, pushing power prices to unsustainable levels. He added that net metering was approved during his ministry’s tenure in 2017-18.

He said Pakistan had already achieved 55 percent green energy by 2025 and was on the right reform trajectory, with institutions including the World Bank welcoming the government’s measures.

After the minister’s speech, the chairman of the session put Senator Zarqa Suharwardy’s resolution on solar panels to a vote, and the House rejected the resolution.

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