PM  Orders Review Appeal Against National Electric Power Regulatory Authority Solar Policy Changes

Prime Minister Shehbaz Sharif on Wednesday directed the Power Division to file a review appeal against recent regulatory changes introduced by the National Electric Power Regulatory Authority (Nepra) affecting solar power consumers.

The directive came after the power regulator revised contractual terms for both existing and future net-metered solar users — commonly referred to as prosumers — replacing the longstanding net-metering framework with a new net-billing mechanism.

According to a statement issued by the Prime Minister’s Office, the premier took “immediate notice” of the regulatory changes amid mounting criticism from lawmakers and stakeholders.

Political Backlash Over Solar Policy Shift

The development follows criticism from members of the Senate across party lines, including representatives from the ruling coalition partner, Pakistan Peoples Party, as well as opposition lawmakers from Pakistan Tehreek-e-Insaf.

The Prime Minister instructed the Power Division to urgently submit a review petition to Nepra, emphasising the need to protect existing consumer contracts. He stated that the financial burden of approximately 466,000 solar users should not be shifted to nearly 37.6 million domestic consumers reliant on electricity supplied through the national grid.

He also directed authorities to formulate a comprehensive strategy addressing the implications of the revised regulations.

High-Level Meeting Reviews Regulatory Changes

The instructions were issued during a high-level meeting chaired by the Prime Minister, attended by senior cabinet members including Deputy Prime Minister Ishaq Dar, Power Minister Awais Leghari, Economic Affairs Minister Ahad Cheema, Information Minister Attaullah Tarar, Minister of State for Finance Bilal Azhar Kiyani, and the Prime Minister’s Adviser Muhammad Ali.

Speaking in the Senate earlier, Power Minister Awais Leghari defended the regulator’s decision, stating that regulatory changes were implemented within the legal and constitutional mandate of the authority and aimed at easing the financial burden on electricity consumers. He clarified that the decision represented a regulatory measure rather than a policy shift.

Transition from Net-Metering to Net-Billing

Energy stakeholders and policy experts have warned that the proposed Prosumer Regulations 2025 could significantly alter the country’s citizen-led renewable energy growth achieved over the past decade.

Under the revised framework, existing registered prosumers will transition from net-metering to net-billing, with electricity exported to the grid credited for only one month instead of the previous three-month adjustment period. Other contractual terms will remain valid until the completion of existing seven-year agreements.

Under the net-billing system, electricity generated by solar users will be purchased by distribution companies at approximately Rs10 per unit based on the National Average Energy Purchase Price. Consumers will then be billed separately for electricity imported from the grid at rates ranging between Rs37 and Rs55 per unit, depending on consumption slabs.

The new regulations also restrict prosumers from installing solar capacity beyond their originally sanctioned load, effectively reducing expansion potential. Additionally, new solar consumers will receive five-year contracts, with export tariffs fixed at Rs11 per unit, significantly lower than the Rs26 rate available under earlier agreements.

Unlike the previous unit-for-unit exchange system, exported and imported electricity will now be calculated separately, with consumers billed for the net difference.

Regulator Cites Grid Stability Concerns

Both government officials and the regulator have attributed rising grid management challenges and increasing capacity charges to solar users installing systems exceeding approved capacity as well as unregistered solar installations. However, critics note that the new regulations do not directly address these issues.

Nepra has maintained that the revised rules introduce clearer operational procedures, stricter technical requirements, and updated billing mechanisms aimed at improving integration of distributed solar generation into the national grid while maintaining overall system stability.