NEPRA Makes Amendment In Net-Metering Regulation

NEPRA held an open hearing on September 27, 2022, regarding the NEPRA draft amendment in the Distribution Generation and Net-metering regulation of 2015. NEPRA claims that after these changes, the current applicable national average power purchase price of Rs. 19.32 / kWh will decrease to Rs 9/kWh. The difference is due to power purchase, including the capacity purchase price.

Earlier, NEPRA held a press release and said that only 20,700 consumers across Pakistan would have to pay these charges. Which are permitted Net Metering according to NEPRA regulations. Meanwhile, during this press release NEPRA Chairman asked these 20,700 net-metering consumers to give up Rs. 10.32/kWh for the extra exported units to DISCOs.

Hence, these consumers must do it for 36 million consumers. This is due to those who do not avail this facility due to lack of resources. However, if we consider this amendment’s after-effects, the capacity under net-metering or self-generation for 20,700 consumers is nearly 476MW. Though for 476 MW, the installed capacity with a plant factor ranging from 16% to 19%, the utmost photo voltaic (PV) generation will be nearly 90MW.

Likewise, to the grid, almost 25 percent or only 23 MW extra units are exported. Hence, considering the current generation of approximately 30,000 MW, what difference to the basket price of 0.08% of self-generation plants for those 36 million consumers without PV systems will make?

Besides, this 0.08% generation may affect DISCO revenues as the net-metered consumers do not steal electricity or refrain from paying bills on time. To mention this amendment in NEPRA regulation will safeguard those unskilled DISCOs instead of pushing them to work on improving themselves.

Let’s consider the difference between net metering and net billing applicable globally. However, when required, a net-metering consumer can exchange the units exported to the grid for the same amount of kWh.

The consumer pays the average purchase or wholesale price for power without distribution overheads in net billing. But in a country like Pakistan, NEPRA isn’t clear about the term net-metering. Presently, the purchase price of power applies to exported units. Although, after amendment, the rate for exported units will decrease, and the effect of this reduction of Rs. 10.32 in money terms will be less than Rs. 0.2 million.

NEPRA is yet to respond to a submitted draft Integrated Generation Capacity Expansion Plan (IGCEP) 2022-31. The submitted draft plan contains 480MW of net metering till 2031. Considering this amendment, NEPRA can never accomplish its target.