The recent power outage followed by increase in per unit charges of electricity has pushed the consumers to opt for alternative options of energy instead of relying only on provision of power by the government.
Instead of staying just as consumers, the clients of power distribution companies have already been provided a modern facility of selling extra electricity, which they could generate easily through the solar and wind systems.
Following successful models of several western and eastern countries, the government had already introduced the net metering technology to facilitate power producing customers and help overcome the menace of load-shedding in the country.
The launch of ‘Net-Metering Regulation’ paves the way for establishment of flexible regulatory regime where any consumer can install solar panels and sell extra electricity to the distribution company concerned by following a simple process. In order to avail the alternative options of electricity, the government has decided to exempt tax on the import and local supply chain of solar panels for facilitating public.
The decision was announced by Finance Minister Miftah Ismail while presenting the Budget for the fiscal year 2022-23 (FY23) in the National Assembly. In the budget, the Finance Minister has also proposed that families using less than 200 units of electricity will be given loans in easy installments for purchasing a solar panel. The metering not only helps in ensuring uninterrupted power supply for consumers but it also goes a long way in establishment of clear and consistent tariff regime where the consumers receive charges for electricity generated by the system they installed. Any consumer who meets the requirement of a distributor generator by becoming a 3 phase domestic, commercial or industrial consumers can submit application to the relevant power distribution companies (DISCO) with necessary documents. The government has already made Net-Metering Arrangement very simple to attract more and more consumers, and DISCOs had set up special facilitation desks to guide the applicants.
The system includes five steps including submission of application, technical review of the application by DISCO, signing of net metering agreement, payment of interconnection charges and sale/purchase of electricity. Many countries such as USA, China, UK, Germany, Australia, Brazil, India, Japan and Thailand etc have been generating electricity through the solar system. Pakistan receives one of the best solar irradiation in the world and has a potential to generate over 2.324 million megawatts electricity per annum through solar thermal and photovoltaic system. Solar irradiation in Pakistan and India stands at 1,900 kWh/m2 against China’s 1,500 and Germany 1,200.
However, net metering works only for grid connected systems and what makes it so beneficial, besides offsetting a self-consumption, is that excess energy sent to the utility is paid for, at the rate identified in the regulations.
The consumer may produce five units of electricity every hour with a 5KW system costing around Rs 700,000 to Rs 800,000. This adds up to total 35 units every day, considering the average daylight for seven hours available for Solar PV panels to operate.
Producing 35 units daily, a consumer can produce around 1050 electricity every month. If there is an average consumption of 600 units for domestic use, 400-450 units can still be sold. Rabia Khalid, consumer manager of Sigma Solar, said that they dealt in 3KW, 5 KW, 8KW, 10 KW, 15 KW and 20KW, adding that the prices started from Rs 600,000 to over Rs 5,000,000 respectively. Now a days, each Solar PV having 540W capacity were being used and around 6-7 panels were needed for 5KW system, she said.
Executive Chairman of Sky Electric Inc Ashar Aziz said that solar system was the best solution for all markets across the globe. It had been adopted globally for multiple reasons, including grid independence, adoption of clean energy, net-metering, and lower electricity bills.
For countries in the developing world with unstable grids, such as Pakistan, India, Bangladesh, Nigeria & various countries in Africa, the main purpose of Solar Solutions was to provide continuous electricity amidst frequent power outages, he said.
Meanwhile, the all power distribution companies (DISCOs) and K-Electric has received a total of 16,149 applications for net metering during the last three years and out of which 12,918 licenses have been issued so far.
According to official data, as many as 1,981 applications were received during fiscal year 2018-19, 4,232 in FY-2019-20 and 9,936 in FY-2020-21. Similarly, out of total, some 1,167 licenses had been issued during FY-2018-19, 3,334 in FY-2019-20 and 8,417 in FY-2020-21. A total of 3,404 net metering licenses have been issued in Lahore Electric Supply Company during the said period, 3,216 in Islamabad Electric Supply Company, 1,089 in Multan Electric Power Company, 740 in Faisalabad Electric Supply Company, 666 in Peshawar Electric Supply Company, 623 in Gujranwala Electric Supply Company, 18 in Hyderabad Electric Supply Company, 13 in Sukkur Electric Supply Company and 2,340 in K-Electric. Neither a single application for net metering was received in Tribal Electric Supply Company nor has any license been issued during the period. IESCO Chief Dr Muhammad Amjad said that the company had installed 5,242 net metering connections so far in various areas of its region. The company had received 5,417 applications for net metering connections so far and out of which 5,325 applications had been approved by the National Electric Power Regulatory Authority.
The installed net metering connections included 4,760 domestic, 322 commercial, 80 government, 62 industrial, 15 agricultural and 3 bulk supply connections, he said. He said that the ‘Net Metering’ consumers had supplied over 58.97 million units to the company resulting in significant reduction in their monthly bills. All field formations had been instructed to provide complete information about the procedure and benefits of net metering to the consumers. He said that the list of approved companies for net metering was also available on AEDB’s website www.aedb.org.
Minister for Energy Engineer Khurram Dastgir was of the view that due to the unprecedented increase in the prices of imported fuel like furnace oil, RLNG and coal, the government had also decided to switch towards other means of generating clean energy. He said that Prime Minister Shehbaz Sharif would soon unveil a concrete policy to generate electricity from solar radiation. The government was taking bold steps to reduce dependency on expensive imported fuels.
