LAHORE:
Pakistan’s electricity sector is at a critical situation, since a growing mismatch between the management of politics and implementation threatens to derail the transition of clean energy of the country.
Although the government once defended the solar facilities on the roof as a long -term solution for the increase in electricity costs and energy insecurity, it is now reversing the course, particularly in the net measurement regime, leaving citizens and the business community by questioning the State’s commitment to renewable energy.
The demand for electricity in the country is around 29,000 megawatts (MW) in the maximum summer, while the installed generation capacity exceeds 46,000 MW. However, the generation remains inefficient due to the underutilization of capacity, poor grid infrastructure and increased dependence on imported fuels. Solar energy, once considered a promising alternative, now faces political obstacles despite contributing about 5% of Pakistan’s total electricity generation in 2025.
Solar facilities, particularly roof systems, increased between 2022 and 2024 as homes and companies invest in net measurement, attracted by generous repurchase rates and government incentives. According to official data, Network capacity increased by just over 300 MW by 2021 to 2,813 MW by the end of fiscal year 2015, with more than 280,000 households recorded under the scheme. But the recent government movement to reduce the repurchase rate of RS27 to RS10 per unit has sent shock waves throughout the solar community.
“The solar transition, once seen as a cornerstone of the future of Pakistan’s energy, it is now treated as an inconvenience,” said Mian Sohail Nisar, a pattern in chief of the Industrial Front and Merchants of Pakistan. “The Government encouraged this change, but now refuses to integrate it into the formal energy system with a long -term vision. This type of political inconsistency undermines both the confidence of investors and public confidence.”
Energy experts argue that the revised net measurement policy comes from growing financial pressure on the national network. With solar users reducing their dependence on the electricity of the network and the sale of surplus energy to high rates, public service companies claim that they are struggling to cover fixed infrastructure costs. In 2024 alone, the cost load changed to consumers dependent on the network was estimated at RS159 billion. The projections suggest that this imbalance could increase to more than 4,000 billion rupees in the next decade if it is not controlled.
A former official of the electricity sector said the problem is not solar energy, it is a bad planning. “The government failed to update the distribution network to handle reverse energy flows. Now they are blaming solar users for losses that are really rooted in poor technical management and obsolete infrastructure.”
He believes that the new gross measurement model, which invoices users separately for imported and exported electricity, can have merit in principle, but has been introduced too abruptly. “Policies like these should gradually graduate with the consultation of the interested parties. Instead, we are seeing an instinctive reaction to financial tension, which could discourage future investments in clean energy.”
Consumers who installed solar panels under the previous stimulus of the government feel betrayed. Many invested a lot in hybrid investors and battery storage, hoping to reduce their dependence on network electricity and benefit from favorable net measurement rates. Now, they fear that the returns will be reduced, the uncertain billing structures and even the undercover replacement of smart meters by the distribution companies.
The inconsistency in energy policy is not new. In the last two decades, successive governments have announced ambitious plans, either for hydroelectric, LNG terminals or renewable energy, only to abandon or reverse them due to political changes, the pressure of public service companies or the reforms communicated with the International Monetary Fund (IMF).
Energy analyst Syed Farid Hussain said that the greatest failure is the lack of a unified transition roadmap. “You cannot expect a successful change to clean energy without aligning network updates, price setting mechanisms and consumer protection. Fragmentary reforms are not a strategy.”
He added that with Pakistan’s circular debt in the electricity sector that crosses RS2.6 billion, the pressure is increasing in the state to increase rates or cutting losses. Unfortunately, instead of reforming inefficiencies in distribution companies or addressing energy theft, the government seems to be placing the load for solar adopters, those who lent their own advice, he said.
A structural approach is the need for time, an approach that cannot be reversed in a couple of years for any reason. “Pakistan does not need policy turos; it needs energy clarity. Without that, we run the risk of removing the same solutions that could boost our future,” added Sohail Nisar.
