The government says it has no choice. Last week, standing in the National Assembly, Khawaja Asif argued that Pakistan’s power sector is bound by legacy contracts and rising capacity payments, defending the revised solar policy and claiming little room to manoeuvre. He further said that the state had to balance the interests of solar users with those still tied to conventional supply, even as criticism grew over new taxes and rising electricity costs.
The circular debt has crossed Rs2.3 trillion, and a large share of the power purchase price is now locked into fixed obligations that must be paid regardless of consumption.
What is now being proposed goes further. It targets the one energy shift ordinary Pakistanis built for themselves after years of official failure. Experts have spent the better part of the last few months cautioning that taxing solar panels and batteries will weaken energy security and raise the cost of the very technologies that have given households and firms some protection from tariff shocks.
People did not turn to solar because a ministry had persuaded them. Neither did they empty what little they had saved to make a statement about climate. Pakistan went through the long attrition of load-shedding, then the nationwide blackout of January 2023 that exposed how fragile the system had become, and then the bill protests of 2023 when traders closed markets across major cities as electricity charges became impossible to absorb. Solar spread in that atmosphere as self-defence.
The scale of that shift is now too large to dismiss. National Electric Power Regulatory Authority data show that by June 2024, more than 156,372 distributed generation solar facilities with installed capacity above 2,200 megawatts had been integrated with the grid through net metering. However, earlier this year, new NEPRA rules slashed the buyback price for rooftop solar exports to the grid to Rs 10 per unit from Rs 27.
This is the heart of the matter. The state did not plan this transition. Citizens did. Now that the transition is large enough to expose the weight of legacy contracts, the policy instinct is to narrow the exit rather than repair the system people are escaping.
There is a real equity case in this debate, because renters and poorer households cannot install rooftop systems as easily as those with capital and space, and that imbalance has been documented in reporting on Pakistan’s solar boom. Yet fairness will not be served by making clean self-generation harder for everyone. It will be served by distribution reforms and a pricing structure that stops asking consumers to bleed at the altar. *