Pakistan’s solar revolution has been hailed as a triumph of energy democracy, but beneath the gleaming panels adorning affluent rooftops lies an uncomfortable truth: less than one per cent of electricity consumers are imposing a financial burden on the remaining ninety-nine per cent. The figures presented at National Electric Power Regulatory Authority (NEPRA)’s recent public hearing are stark. By December 2024, approximately 400,000 net-metered consumers had shifted PKR 270 billion onto 38.5 million grid users who cannot afford rooftop installations. Without policy intervention, this regressive cost transfer would have cumulatively ballooned to PKR 4.6 trillion by 2034.
The mathematics is straightforward. Considering further analysis and declining grid sales, 73 per cent of fixed costs associated withtransmission infrastructure, and system maintenance was being borne by those dependent on the grid. These obligations exist regardless of electricity flow. When affluent households install oversized solar systems, they reduce their grid consumption whilst relying on the network for evening supply. The fixed costs they avoid must still be paid, redistributed across remaining consumers through higher tariffs. This translates to an additional PKR 2.87 per unit burden on non-solar households in 2026, projected to reach PKR 5.36 per unit by 2034.
For a lower-middle-income family consuming 300 units monthly, the additional cost imposed by net-metering amounts to approximately PKR 860 per month today, rising to PKR 1,608 monthly within a decade. These families, already struggling with inflation and stagnant wages, are essentially financing the electricity bills of neighbours who possess capital to invest PKR 1.5 to PKR 2 million in photovoltaic systems. The policy question is not whether renewable energy should be encouraged, but whether its expansion should come at the expense of those least able to afford it.
The technical challenges compound economic distortions. Distribution companies at the February hearing detailed severe grid stability concerns arising from uncontrolled solar penetration. The duck curve phenomenon has emerged across major cities, where daytime solar generation creates a pronounced demand dip, followed by steep evening ramps when panels cease producing and households simultaneously activate lights, air conditioners, and appliances. This pattern forces conventional plants to operate at part load during midday, significantly increasing per-unit fuel costs, then ramp up rapidly at dusk, straining generation and transmission systems. K-Electric reported voltage backfeed problems affecting even solar consumers themselves, whilst GEPCO warned on behalf of state-owned distribution companies that unmanaged renewable integration risks system destabilisation and increased blackout frequency.
Infrastructure implications are equally sobering. Several distribution companies noted transformer loading in affluent neighbourhoods has reached critical thresholds, with some transformers experiencing over-voltage conditions and accelerated equipment ageing. Power factors have declined, reactive power support has become inadequate, and the regulatory requirement that prosumer capacity not exceed 80 per cent of transformer rating is being routinely violated. A number of prosumers were found operating unauthorised capacity well beyond their approved limits, exacerbating grid stress without penalty. These represent measurable degradation of a distribution network that serves millions.
The Prosumer Regulations 2026 address these distortions directly. By shifting to net billing, the framework ensures exported electricity is valued at its true system cost rather than the full retail tariff, which includes capacity charges and transmission expenses that solar prosumers avoid when offsetting consumption. The national average energy purchase price reflects what utilities pay for generation during peak solar hours, typically PKR 10 to PKR 13 per kilowatt-hour, whilst retail tariffs range from PKR 42 to PKR 48 per unit during evening peak when solar produces nothing.
Critics characterise this as punitive towards renewable energy. This misrepresents the policy’s intent. Existing agreements remain valid until expiry. New prosumers retain the ability to install solar, connect to the grid, and receive payment for exported electricity. What changes is elimination of a cross-subsidy creating unsustainable equity problems. The regulations encourage right-sizing systems for self-consumption rather than oversized installations built primarily to export surplus at inflated rates or in other words, they discourage a profiteering or rent seeking mindset.
Pakistan’s energy transition must be both sustainable and equitable. The new prosumer regulations strike this balance, preserving renewable energy incentives whilst preventing the concentration of benefits amongst those who need them least and the imposition of costs on those who can afford them least. This is not a retreat from clean energy. It is a necessary correction to ensure the transition serves all Pakistanis, not merely the privileged few.
