A sharp drop in Pakistan’s solar power buyback rate—from Rs27 to Rs10 per unit—has triggered widespread concern within the solar energy sector, dampening consumer confidence and slowing new installations across the country.
The sudden policy change has disrupted what is typically the peak season for solar system sales, as households and businesses usually gear up for higher summer electricity costs. This year, however, industry insiders report a significant slowdown in demand despite historically low prices for solar equipment.
Stakeholders, including solar vendors and importers, warn that the lack of a stable net metering policy is undermining market confidence. They say the recent decision has created uncertainty, discouraging new investments in solar infrastructure.
“Normally, we see a surge in installations before summer,” one vendor noted. “But due to the confusion around net metering, consumers are hesitant to commit—even though solar systems are more affordable than ever.”
Driven by a global supply glut, particularly in China, prices for high-quality solar equipment have fallen sharply. Grade-A solar panels with branded inverters are currently priced between Rs100 and Rs120 per watt, down from Rs160-165 just a few years ago. A typical 5-kilowatt (KW) system now costs approximately Rs600,000, while 10-KW systems are around Rs1.15 million. Larger 15KW and 20KW setups are priced at roughly Rs1.4 million and Rs1.8 million, respectively.
Despite these falling costs, the reduced buyback rate is altering consumer behavior. “More people are now opting for hybrid systems with battery storage,” said a solar equipment importer. “Rather than selling electricity back to the grid at an unviable Rs10 per unit, users are storing power for personal use.”
As a result, battery sales have surged, reflecting a shift toward energy self-sufficiency among solar users.
The industrial sector isn’t immune either. Delays by the National Electric Power Regulatory Authority (NEPRA) in approving power purchase agreements are further contributing to the prevailing uncertainty.
Industry leaders are now calling on the government to provide clear, consistent net metering policies to restore market confidence. Without regulatory clarity, experts warn that Pakistan risks losing momentum in its renewable energy transition.
This comes at a time when solar adoption had been accelerating. According to the Global Electricity Review 2025 by UK-based energy think tank Ember, Pakistan imported a record 17 gigawatts (GW) of solar panels in 2024—more than twice the previous year’s total—ranking it among the world’s top solar markets.
