What is gross metering and how will it affect solar consumers?

• New five-year contracts, with possibility of extension.
• Proposed new purchase tariff to apply to new installations.
• Rooftop solar results in a 3.2 billion reduction in grid sales.

Islamabad: Amid the prevailing solar boom in the country, the National Electricity Regulatory Authority (Nepra) has advised a major policy change that seeks to replace the existing metering system with a gross metering mechanism for solar rooftop consumers, citing an increasing financial burden on conventional grid users. The News reported on Monday.

According to the proposed Nepra Prosumer Regulations (NPR), a newly drafted 18-page document uploaded on the regulator’s website, prospective domestic solar consumers will exchange electricity with their respective distribution companies (Discos) through gross metering and not net metering.

However, existing net metered consumers with valid seven-year contracts will continue to sell their excess electricity at Rs22 per unit until their contracts expire.

For new solar installations, electricity exports will be compensated under a gross metering framework with a proposed feed-in tariff of Rs 11.30 per unit.

These contracts will be valid for five years and may be extended on a mutual basis. Nepra has invited stakeholders and consumers in 30 days and may hold a public hearing before finalizing the regulations, an official said.

The shift follows concerns that the current net metering regime imposes a financial burden of up to Rs 2 per unit on non-solar consumers. In a meeting held on October 22, Chief Minister Shehbaz Sharif asked the Power Division and Nepra to review and verify the buyback tariff and its wider impact before finalizing the reforms.

Under net metering, electricity exported to the grid is adjusted against electricity imported, reducing consumer bills. In contrast, gross metering compensates consumers with a fixed feed-in tariff for all electricity generated and exported, while electricity consumed from the grid is priced separately in retail tariffs.

According to official data, the rapid expansion of rooftop solar has led to a 3.2 billion unit reduction in grid electricity sales in 2024, causing nearly Rs 101 billion in revenue losses for distribution companies. This contributed to an average tariff increase of Rs 0.9 per kWh for other consumers.

The Power Department’s projections warn that by 2034, lost grid sales could rise to 18.8 billion units, translating into an impact of Rs 545 billion and a potential tariff hike of Rs 5-6 per unit. “The grid is effectively used as battery storage for solar consumers,” said an energy official, noting that net metering users sell excess power at high buyback rates while avoiding fixed system charges.

Officials argue that the imbalance is evident as new utility-scale solar projects are being contracted for below Rs 10 per unit, making the buy-in of Rs 22 per net metering unit unsustainable. The proposed gross metering tariff of Rs 11.30 per unit is aimed at preventing further tariff escalation for grid-connected consumers.

The rapid growth of solar net metering — now estimated at 6,000 MW nationwide — has also raised operational concerns. Winter electricity demand often drops to 8,000-9,000 MW, increasing the risk of overproduction during the day.

Energy planners warn that unchecked expansion could threaten grid stability, citing the experience of Sri Lanka, where a sudden solar flare caused a nationwide blackout.

Authorities have also identified cases of misuse, including consumers with permitted loads of 10 kW exporting up to 20 kW to the grid. To counter this, Discos have started installing smart meters with real-time monitoring and control of extraction.