February 2026 will be remembered as the most volatile month in the history of Pakistan’s solar energy sector. Within the span of just one week, the country witnessed a major regulatory overhaul, massive public outcry, and a high-level government intervention that paused what many called “the death of solar.”
If you are searching for “net metering policy latest news 2026”, you likely want to know: Is my solar investment safe?
The short answer is: Yes, for now—but the rules have changed forever.
NEPRA (National Electric Power Regulatory Authority) has officially notified the shift from “Net Metering” to “Net Billing“, drastically reducing the rates for exported electricity. However, following a direct directive from Prime Minister Shehbaz Sharif, a Draft Amendment has been issued to protect existing users.
This article provides a detailed breakdown of the breaking news, the new “Net Billing” mechanism, and what the future holds for solar adoption in Pakistan.
Timeline of Events: What Happened in February 2026?
To understand the current confusion, Net Metering Policy Latest News 2026 we must look at the rapid sequence of events that unfolded earlier this month.
- February 9, 2026 (The Shock): NEPRA officially issued the notification for the Prosumer Regulations 2026. This document effectively ended the old Net Metering regime and introduced “Net Billing” with immediate effect.
- February 10-14, 2026 (The Backlash): The notification triggered panic. The Pakistan Solar Association (PSA), industrial bodies, and thousands of homeowners protested, arguing that the sudden policy shift would kill the green energy momentum.
- February 15, 2026 (The Intervention): Taking notice of the public unrest, Prime Minister Shehbaz Sharif directed the Ministry of Energy and NEPRA to review the policy and ensure that “existing consumers remain unaffected.”
- February 16, 2026 (The Relief): NEPRA released a Draft Amendment to the 2026 regulations. This amendment explicitly proposed a “Grandfathering Clause” to protect all existing Net Metering licenses for their remaining 7-year term.
- Current Status: The policy is currently in a 30-day Public Consultation Phase. Stakeholders have until mid-March to submit their feedback before the final gazette notification.
The “Net Billing” Controversy Explained
Why was there such an uproar? The core of the issue lies in the financial difference between “Metering” and “Billing.”
1. The Death of 1:1 Exchange
Under the old Net Metering rules, the grid acted as a simple storage unit. If you gave 100 units to the grid and took 100 units back, your net bill was zero.
- New Rule: Under Net Billing, there is no unit exchange. The grid buys your units at a low price and sells them back to you at a high price.
2. The Rate Crash (Buyback Price)
The most controversial change is the reduction in the “Buyback Rate”—the price DISCOs pay you for your excess solar power.
- Old Rate (Net Metering): Linked to the National Average Power Purchase Price (approx. Rs. 22-27 per unit).
- New Rate (Net Billing): Linked to the National Average Energy Purchase Price (approx. Rs. 10.50-11 per unit).
Impact: This 50%+ reduction means that the “passive income” aspect of solar is effectively dead for new applicants. You can no longer install a large system to earn money; you can only use it to save on your own bill.
3. Contract Duration Reduced
In another blow to investor confidence, the license duration for new connections has been slashed.
- Previous Term: 7 Years.
- New Term: 5 Years. After 5 years, the terms are renewable, but likely at even lower rates if grid electricity becomes cheaper (unlikely) or capacity charges increase.
(Internal link suggestion: Read our detailed analysis on How Did NEPRA Change Net Metering Policy in 2026? for a full breakdown of the ROI calculations.)
Prime Minister’s Intervention & The “Grandfathering” Relief
The saving grace for millions of households was the swift intervention from the PM Office. The directive was clear: “Do not retrospectively punish those who invested based on government promises.”
Prior to this intervention, there were fears that NEPRA might forcibly convert all users (old and new) to the new Rs. 11 rate. The Draft Amendment clarified this:
The “Grandfathering” Clause
- Who is Safe? Any consumer who had a valid Net Metering License issued before February 9, 2026.
- What is Protected? Your buyback rate and the 1:1 netting mechanism will remain unchanged until your 7-year contract expires.
- Who is NOT Safe? Any application submitted after February 9, 2026. These new applicants will automatically fall under the new Net Billing regime.
Warning: If you are an existing user and you apply for a load extension (e.g., upgrading from 5kW to 10kW), your entire system might be re-classified as “New,” forcing you onto the Net Billing rates. Consult your installer carefully before upgrading.
Impact on New Solar Applicants (Post-Feb 2026)
For anyone planning to install solar now, the math has changed. Here is a comparison of the landscape before and after the February 2026 notification.
| Feature | Pre-Feb 2026 (Old) | Post-Feb 2026 (New) |
|---|---|---|
| Model | Net Metering (Unit Swap) | Net Billing (Cash Sale) |
| Export Rate | ~Rs. 22 / Unit | ~Rs. 11 / Unit |
| Contract | 7 Years | 5 Years |
| Transformer Limit | Flexible | Strict 80% Cap |
| ROI | 2.5 – 3 Years | 4 – 5 Years |
Is Solar Still Viable? Yes, but the strategy must shift.
- Old Strategy: Oversize the system (e.g., 15kW for a 10kW load) to sell excess power and cover winter bills.
- New Strategy: Undersize the system (e.g., 8kW for a 10kW load) or add Batteries (Hybrid) to consume 100% of your production. Selling to the grid at Rs. 11 is a financial loss when you buy back at Rs. 45.
Solar Industry Reaction: Panic in the Market
The Pakistan Solar Association (PSA) has been vocal about the potential damage this policy could cause. In a press conference held on February 12, 2026, PSA Chairman warned that:
“The government’s flip-flop policy is discouraging foreign investment. Just as Pakistan was becoming a leader in renewable energy adoption, these regressive measures are pushing us back to the fossil fuel era.”
Major solar vendors have reported a 30% drop in new inquiries since the notification. However, the market is adapting quickly.
The Rise of “Hybrid” Inverters
Dealers are now exclusively pushing Hybrid Inverters (which can manage both grid and battery power) instead of simple On-Grid inverters. The price of Lithium-Ion batteries has also dropped globally, making them more affordable for Pakistani households. This shift means that while the grid loses a customer, the consumer gains true energy independence.
(Internal link suggestion: Check out our buyer’s guide on Best Hybrid Solar Inverters in Pakistan 2026 to prepare for the new era.)
Why is NEPRA Doing This? The Circular Debt Crisis
To understand the “why” behind this harsh policy, we must look at the bigger picture of Pakistan’s energy sector. It isn’t just about targeting solar users; it’s about saving the national grid from collapse.
The “Capacity Payment” Trap
Pakistan’s power sector is burdened by Capacity Payments. The government has signed contracts with Independent Power Producers (IPPs) guaranteeing them payments for their available capacity, even if no electricity is bought.
- The Problem: As more wealthy households shift to solar (Net Metering), grid demand drops.
- The Consequence: The fixed capacity payments must now be divided among fewer remaining grid users (mostly poor households).
- The Vicious Cycle: To cover costs, NEPRA raises tariffs. Higher tariffs push more people to solar. The grid loses more paying customers.
NEPRA’s Logic: Net Metering users are using the grid as a “free battery.” They export excess power when the grid doesn’t need it (daytime) and pull power when the grid is most stressed (evening peak). By moving to Net Billing, NEPRA wants prosumers to pay for the service of using the grid network.
Comparative Scenarios: The Financial Blow
Let’s break down the financial impact with two hypothetical scenarios to show exactly how much money a new user loses compared to an old user.
Scenario 1: The “Old Regime” User (Grandfathered)
- System: 10kW On-Grid.
- Generation: 1200 Units/Month.
- Consumption: 1200 Units/Month (600 Day / 600 Night).
- Export: 600 Units (Day).
- Import: 600 Units (Night).
- Bill Calculation:
- Net Units = 600 (Imp) – 600 (Exp) = 0 Net Units.
- Bill: Zero (Only taxes/fixed charges).
Scenario 2: The “New Regime” User (Net Billing)
- System: 10kW On-Grid.
- Generation/Consumption: Same as above.
- Bill Calculation:
- Cost of Import (600 units): 600 x Rs. 45 = Rs. 27,000.
- Credit for Export (600 units): 600 x Rs. 11 = Rs. 6,600.
- Net Payable: 27,000 – 6,600 = Rs. 20,400.
The Difference: For the exact same usage, the new user pays Rs. 20,400 per month, while the old user pays Zero. This is the reality of the 2026 policy shift.
How to Protect Your Investment: 2026 Strategy Guide
If you are caught in this transition, panic is not the answer. Strategy is. Here is a step-by-step guide on how to navigate the new landscape.
1. For Existing License Holders
- Do NOT Touch Your System: Do not apply for a load extension or meter change. Even a small change could trigger a “New Application” status.
- Wait for the Gazette: Wait for the final notification to confirm if the 7-year term is locked in.
- Monitor Your Bill: Check your monthly bills carefully to ensure DISCOs are not secretly applying Net Billing logic (Rs. 11 rate) to your account.
2. For New Applicants (In Process)
- Check Your Status: If your demand notice was paid before Feb 9, fight for your right to be “Grandfathered.” Submit a written complaint to NEPRA if your DISCO forces you onto the new rates.
- Switch to Hybrid: If you haven’t bought the inverter yet, cancel the On-Grid order. Buy a 12kW Hybrid Inverter (IP65 rated).
- Battery Sizing: Invest in at least 10kWh of Lithium Battery storage. This will allow you to store your 600 exportable units instead of selling them for peanuts.
3. For Future Investors
- Ignore the Grid: Design your system as if the grid doesn’t exist. Calculate your ROI based on savings only.
- Zero Export Device (ZED): If you don’t have batteries yet, install a ZED to prevent exporting to the grid. There is no point in giving essentially free electricity to the government and risking voltage fluctuations.
Future Outlook: What Happens Next?
The policy is currently in the consultation phase. This means it is not legally finalized yet. However, given the pressure from DISCOs to stop revenue loss, it is highly unlikely that NEPRA will completely reverse the decision.
Predictions for Mid-2026:
- Strict Enforcement: The 80% transformer limit will be strictly enforced, effectively banning solar in saturated urban areas like DHA and Bahria Town.
- Smart Metering: The government will accelerate the rollout of AMI (Advanced Metering Infrastructure) to automate the new Net Billing calculations.
- Solar Tax Discussions: Rumors persist about a “fixed tax” on solar users to cover grid maintenance costs, though this remains unconfirmed.
Frequently Asked Questions (FAQ) – News Edition
Q1: Is the new Net Billing policy finalized?
Technically, no. It is in the Draft Stage for public consultation until mid-March 2026. However, NEPRA rarely reverses major policy decisions completely. Expect minor tweaks, but the shift to Net Billing seems inevitable.
Q2: I applied before Feb 9 but haven’t got a green meter yet. Which rule applies?
According to the Draft Amendment, if your application was “processed and approved” before the notification date, you come under the Old Regime. If you only submitted the application but got no approval, you fall under the New Rules.
Q3: Will NEPRA reverse the decision completely?
It is unlikely. The pressure from the IMF and the power sector’s circular debt creates a strong incentive for the government to stop “over-subsidizing” solar owners through 1:1 net metering.
Q4: How do I submit feedback to NEPRA?
You can email your comments to registrar@nepra.org.pk or attend the public hearing scheduled for March 10, 2026, at NEPRA headquarters in Islamabad.
Q5: What is the “Green Meter” replacement news?
There are reports that existing Green Meters (Bi-Directional) might need firmware updates to handle the new billing logic. However, hardware replacement is not required immediately for most users.
Glossary of Terms: Understanding the 2026 Regulation Jargon
To help you navigate the confusing official documents, here is a quick glossary of the key terms used in the NEPRA regulations.
- Prosumer: A consumer who also produces electricity (Producer + Consumer).
- Net Metering: The old mechanism where energy units were swapped 1-to-1.
- Net Billing: The new mechanism where energy is bought and sold at different financial rates.
- NAPPP (National Average Power Purchase Price): The price DISCOs pay to buy power from large power plants (IPPs).
- NAEPP (National Average Energy Purchase Price): The marginal cost of fuel. This is the new (lower) rate you get for your solar exports.
- Grandfathering: A legal clause that protects old users from new rules.
- Capacity Payment: The fixed rent paid to power plants just for being available, regardless of usage.
Conclusion
The February 2026 Net Metering Crisis has shaken investor confidence, but it hasn’t killed the solar industry. It has merely evolved it. The days of making easy money by selling electricity to the government are over. The new era is about self-consumption and intelligent storage.
If you are an existing user, breathe a sigh of relief—your grandfathered rights are protected for now. If you are a new applicant, do not be discouraged. Solar is still cheaper than grid electricity; you just need to design your system smarter. Invest in batteries, minimize exports, and secure your energy future.
