ISLAMABAD – National Electric Power Regulatory Authority (NEPRA) decided to retain mandatory licensing requirement for solar consumers under the net metering system, maintaining strict regulatory oversight over small-scale solar installations across Pakistan.
Households and businesses installing solar systems between 1 kilowatt and 25 kilowatts will still be required to obtain NEPRA generation license, despite growing expectations of a complete exemption for small users. Authorities clarified that while the license fee for systems up to 25 kW has been waived, the authority to issue licenses remains exclusively with NEPRA, making regulatory approval compulsory before any grid connection can be activated.
Sources further revealed that all applicants must now go through a dedicated online portal, which directly forwards applications to NEPRA for licensing review and approval. It has also been made clear that no net metering application can be processed without a valid NEPRA license, reinforcing the regulator’s central role in controlling access to the system. Applications already submitted by users are currently under review and being processed for approval.
Power Division had pushed for a full exemption from licensing requirements for systems up to 25 kW in order to simplify procedures and promote solar adoption. However, NEPRA only agreed to remove the fee while keeping both the licensing requirement and the online system intact.
Sources added that a final decision is expected within the current month, which will determine whether the licensing requirement for small-scale solar users is permanently abolished or continues, a ruling that could significantly reshape Pakistan’s rapidly growing solar net metering market.
End of Solar License Fee
Pakistan’s solar sector has seen major policy shifts in recent years. At one stage, NEPRA introduced “prosumer regulations” requiring both a generation license and a Rs 1,000 per kW one-time fee for all solar installations, including small rooftop systems. The move triggered widespread criticism for increasing costs and slowing adoption.
Later, Power Division intervened and formally requested NEPRA to withdraw both the licensing requirement and fees for systems up to 25 kW to reduce bureaucratic hurdles and encourage solar expansion.
After this, the fee was waived for small systems, while larger installations above 25 kW continue to remain subject to regulatory charges and compliance conditions.
Under evolving framework, approvals for small-scale solar users are now handled through digital systems linked with distribution companies, marking a shift from earlier centralized processing. The ongoing policy uncertainty comes at a time when Pakistan is witnessing rapid growth in rooftop solar adoption driven by high electricity costs and power shortages.
How many people use Solar in Pakistan?
Pakistan is undergoing one of the fastest people-driven solar revolutions in the world, fueled by soaring electricity costs, an unreliable national grid, and sharply falling prices of solar panels. The shift is being led largely by households and small users adopting off-grid and hybrid systems, particularly in rural and underserved regions.
Recent estimates suggest that around 15% to 25% of Pakistani households are now using solar energy in some form—ranging from basic lighting solutions to full household electricity systems or hybrid setups linked with the national grid. In several rural areas of Sindh and Balochistan, adoption rates are reported to exceed 50%, highlighting deep penetration in off-grid communities.
In the grid-connected segment, Pakistan had approximately 466,000 net-metered solar connections by early 2025, with installed capacity reaching nearly 5.3 GW by April 2025. Industry data shows this figure continues to climb rapidly as more users shift toward solar energy.
Broader estimates that include off-grid and distributed systems suggest Pakistan’s total solar capacity may now stand at around 27 to 34 GW or more, with the overwhelming majority coming from rooftop and standalone systems rather than utility-scale projects. This rapid expansion has been driven by large-scale imports of solar equipment over recent years.
Adoption remains strongest in rural regions and provinces such as Khyber Pakhtunkhwa, where solar is widely used for household lighting, fans, irrigation pumps, and small businesses. Many users rely on off-grid or hybrid systems due to frequent grid instability and power shortages.
Pakistani Solar Users to Pay Rs1,000 per Kilowatt License Fee under new policy
