• Nepra releases draft regulations, seeking feedback within 30 days before repealing 2015 legislation
• Life of new contracts to be reduced from seven to five years
ISLAMABAD: After repeated botched attempts by the power division, the National Electric Power Regulatory Authority (Nepra), mandated by the government, has now moved to cut size, life and repayment rates of the net-metered solar power consumers by almost half in an apparent attempt to protect an expensive and inefficient power utility business from irrelevance and complete collapse.
The regulator formally released draft Prosumer Regulations, 2025, on Tuesday for public comments within 30 days before repealing the Alternative and Renewable Energy Distributed Generation and Net Metering Regulations, 2015. The revision in net-metering policy is aimed at creating a ‘balance’ between the interests of the utilities and consumers by allowing them to hedge against unaffordable rates but without allowing this to be a profitable business.
Under the proposed measures, the prosumers — a term used for net-metered users being solar producers as well as consumers — would not be allowed to install solar systems for net metering beyond their original sanctioned load, thus reducing the capacity limit by 50pc. For example, a 10-kilowatt (kW) consumer would be able to install only up to 10kW solar net-metering system and so on.
At present, prosumers are legally entitled to a 150pc solar capacity against their sanctioned load for grid consumption. The existing rules allow 10kW prosumer to have 15kW of solar system for net metering. However, the existing consumers would be unaffected by the changes till the expiry of their existing seven-year term and then will come under the new regulations.
The new regulations are now applicable to all — from one-kilowatt generation to one-megawatt (1MW) generation — in terms of direct regulatory and licensing domain of Nepra. At present, less than 25kW consumers are directly licensed by Discos.
Five-year contract
The life of future contracts for net metering would be limited to five years instead of the existing seven, renewable with mutual consent of distribution companies and consumers and without any obligation, for another five years, under the proposed regulations.
In addition, prosumers would be paid only the National Average Energy Purchase Price (NAEPP), estimated at about Rs13 per unit (half of their current entitlement of about Rs26 per kilowatt-hour (kWh), for their surplus energy fed into the national grid or distribution network of Disco.
Just last week Nepra had described the quality of service provided by Discos as ‘sub-optimal’. “Compounded by heavy taxes, levies, and surcharges, particularly the debt servicing surcharge, these factors collectively inflate electricity costs for consumers. The result is a shifting of consumers towards decentralised or off-grid solutions, further weakening the demand for grid-based electricity”, Nepra then stated, adding the on-grid solar installations to have surpassed 6,000MW, and total solar capacity, including both on-grid and off-grid systems, gone beyond 13,000MW.
The proposed regulations also entail clearer procedures, stricter technical requirements, and a shift in billing methodology, aiming to better integrate small-scale power generation into the national grid while safeguarding the system stability.
The regulations set out a detailed and time-bound application process. Applicants must submit their requests using standardised forms while Discos are obligated to provide all relevant information and Nepra-approved documents free of cost within two working days of a request. Upon receiving an application, the licensee must acknowledge it within five working days and indicate whether it is complete. Any missing documents must be provided by the applicant within three working days of notification.
Another critical proposed restriction is a capacity cap at the transformer level. Discos are expressly barred from entertaining new applications if the cumulative distributed generation capacity connected to a particular distribution transformer reaches 80pc of its rated capacity to avoid overloading and technical instability in local distribution networks.
For larger installations, the regulations impose additional technical scrutiny. Applicants proposing distributed generation facilities of 250kW or above are required to conduct and submit a load flow study, either by Disco or a third party reputable consultant registered with the Pakistan Engineering Council. The Disco will then conduct an initial technical review within 15 working days to assess feasibility, leading to contract signing or return of application in case of infeasibility. Both cases will be reported to Nepra.
Following the execution of the agreement, the Disco will provide an estimate for connection charges within seven working days, covering interconnection facilities up to the interconnection point, including metering installation. The prosumer is required to pay these charges within seven working days, after which the licensee must install and commission the interconnection facility within 15 working days.
Published in Dawn, December 17th, 2025
