The recent approval by the Economic Coordination Committee (ECC) to significantly reduce the electricity buy back rate marks a turning point for Pakistan’s energy consumers. This decision is expected to be a lifesaver for grid-connected customers, as they will no longer bear the additional burden of capacity payments, which have long strained their finances.
Previously, consumers were indirectly subsidizing net metering users, as excess solar energy sold back to the grid created an imbalance in cost-sharing. With this adjustment, grid consumers will no longer be forced to cover the capacity charges, making electricity pricing more equitable.
Despite concerns, the impact on the solar industry may not be as severe as assumed. Most solar system adopters belong to higher income groups, who can still afford to invest in hybrid solar setups. Importantly, there are no explicit restrictions on hybrid solar systems, as long as they meet the required technical and safety standards. This allows consumers to continue benefiting from energy independence while maintaining grid stability.
Additionally, DISCO categorizes residential consumers based on their income levels, such as lifeline consumers, protected consumers, non-protected consumers, and three-phase consumers. Lifeline and protected consumers primarily belong to poor class and lower-middle-class segments who are struggling financially. These groups generally do not invest in solar installations, as they often live as tenants and lack the resources for such infrastructure.
While solar power remains crucial for Pakistan’s renewable energy transition, the new policy ensures fairness by distributing costs more equitably across all consumers. Encouraging hybrid solar investments will allow well-off consumers to sustain their renewable energy ambitions while reducing financial strain on those solely dependent on the grid.
This move by the ECC, therefore, represents a strategic balance between affordability and sustainability, ensuring that the energy sector evolves in a way that benefits all stakeholders.
