The recent decision by the National Electric Power Regulatory Authority (Nepra) to alter the framework for rooftop solar users has sparked widespread debate. By moving from net-metering to net-billing, the regulator has effectively changed how households and businesses are compensated for the electricity they export to the grid. While the stated objective is to protect the financial stability of distribution companies, the implications of this policy are far-reaching and risk deepening the structural challenges already facing Pakistan’s power sector.

Under the new rules, prosumers who generate electricity through rooftop solar panels will no longer receive equal credit for the units they supply to the grid. Instead, they will be paid at a lower rate for exported electricity, while being charged a higher tariff for the units they consume from the grid. This imbalance reduces the financial incentive for households and businesses to invest in solar energy, pushing many towards self-consumption and off-grid solutions. Ironically, this could accelerate grid defections, leaving distribution companies with fewer customers and making it even harder to recover fixed costs.

The government has argued that solarised consumers represent a privileged segment benefiting disproportionately from the system, while the burden of maintaining the grid falls on those who remain fully dependent on conventional electricity. Yet this narrative oversimplifies the reality. Net-metered consumers account for only a small fraction of total electricity demand—roughly one percent of the national system. Penalising them will not resolve the sector’s fundamental problems of inefficiency, high transmission losses, and reliance on expensive imported fuels. Instead, it risks discouraging investment in clean energy at a time when Pakistan urgently needs to diversify its energy mix.

The prime minister’s decision to review Nepra’s move following public outcry reflects recognition of the sensitivity of the issue. However, the broader policy direction appears clear: solar adoption is being managed through centralised control rather than encouraged as part of a long-term reform strategy. The imposition of taxes on solar panel imports earlier, coupled with these new regulations, signals a deliberate attempt to slow the pace of solarisation. Such measures may provide temporary relief to distribution companies, but they undermine national commitments to renewable energy and climate resilience.

Pakistan’s power sector has long struggled with declining demand, rising costs, and mounting circular debt. Addressing these challenges requires systemic reform—improving efficiency, reducing losses, and rationalising tariffs—not discouraging consumers from adopting cleaner alternatives. Solar energy offers households and businesses a way to reduce dependence on costly grid electricity, while contributing to national energy security. Curtailing this option risks alienating consumers and eroding trust in regulatory institutions.

The lesson is clear: punishing early adopters of solar will not fix the sector’s structural flaws. Instead, it will push more consumers to disconnect from the grid, leaving the system weaker and less sustainable. Pakistan’s energy future depends on policies that encourage innovation, expand renewable adoption, and balance the interests of all stakeholders. Nepra’s decision, unless reconsidered, risks moving the country in the opposite direction.