Pakistan’s Solar Boom Reaches 7,000 MW as Govt Moves to Replace Net Metering

Pakistan’s rooftop solar capacity has expanded nearly 37 fold over the past six years, reaching almost 7,000 MW by June 2026, prompting the government to replace the country’s net metering regime with a new net billing system to address growing financial and technical challenges in the power sector.

Speaking at a SAARC webinar, Energy Adviser to the Power Division Syed Faizan Ali said solar generation under Pakistan’s net metering framework increased from just 190 MW in FY2020 to around 6,978 MW by FY2026.

He attributed the rapid expansion largely to rising electricity prices, the depreciation of the Pakistani rupee, and a sharp decline in global solar panel prices.

According to the presentation, the rupee depreciated by around 75 percent between FY2021 and FY2025, electricity tariffs increased by nearly 140 percent, and imported solar panel prices fell by approximately 60 percent during the same period. These factors significantly improved the economics of rooftop solar, driving record installations across the country.

However, the one to one credit mechanism under the previous net metering system also created financial pressure on the electricity sector. Officials estimated the policy had a Rs. 101 billion revenue impact in FY2024, leading policymakers to replace it with the Prosumer Regulations 2026, which came into effect on February 8, 2026.

Under the new net billing framework, new rooftop solar consumers are paid a lower reference price for electricity exported to the grid, while electricity imported from the grid continues to be billed at the applicable retail tariff. Existing consumers who signed net metering agreements under the 2015 regulations will continue receiving their agreed benefits until their contracts expire.

Officials say the challenge going forward will be balancing consumer incentives for rooftop solar while protecting the financial health of the power sector and limiting the cost burden on consumers without solar systems.