How Net Metering Works In Pakistan
Posted On: 02 February, Author: ZeroCarbon
Net metering Pakistan is an electricity policy for consumers, who own / plan to setup a Renewable Energy facility, which allows them to produce electricity (using solar) for their own use and supply the excess produce to the national grid setting-off units of electricity consumed during off-peak hours or at times when the production from RE facility is not enough to meet the consumer load. The consumer will either pay reduced utility bill or get paid for access energy exported to the grid.
NEPRA, in September 2015, issued its net-metering regulations that allow the DISCOs in Pakistan to purchase excess units of electricity produced by the consumers, and net them off against the units consumed from the grid. As per these regulations, any customer of the national grid (having three-phase connection) can avail net-metering facility for small-scale (1kW to 1MW) Renewable Energy installations. Renewable Energy is a long-term power solution. The Solar PV Technology gives access to affordable electricity supply during system life. Residential and commercial customers can switch their electricity load to Renewable Energy (RE) and can slash their power bills.
Net Metering Pakistan
Net metering Pakistan supplies substantial financial advantages in regards to power generation, earnings and also investment. You can easily join the process which is simple and handy. The first step is to install a net metering compliant solar system which is not very complex as our team at zero carbon will help you out to sort things out while doing the initial set up.
At the second step you need to prepare an application and here again we help you while doing that too. To apply you need to contact relevant electric company.
The installed system must comply with these rules. The relevant electric company will inspect and will issue the NOC after complete satisfaction. Then you will have to sign the agreement with the electric company. After that generation license will be allotted and your net meter will be activated. Net meter activation is the last process and after that you can participate to the grid accordingly.
What is Net Metering in Pakistan?
For Pakistani consumers, who either own or plan to establish a facility for renewable energy, the electricity policy is known as net metering in Pakistan. This electricity policy permits them to create electricity via solar energy, not just for their own consumption, but also to supply the excess electricity into the national grid. This excess electricity is then consumed during hours of low consumption or during times when the RE facility doesn’t produce ample electricity to satisfy the consumer need.
In such cases a consumer will be compensated by one of two options:
- Pay a reduced utility bill
- Get a payment for the excess energy
How consumers are compensated is determined by the relevant DISCO, as specified in the contract. During September 2015, NEPRA’s net-metering regulations were issued which permit the Pakistani DISCO’s to purchase surplus electricity which the consumers produced, to set it off against the grid’s consumed units.
According to these regulations every customer of Pakistan’s national grid who has a 3-phase connection can utilize a net-metering facility installation for Renewable Energy on a small scale – 1kW – 1MW. Renewable Energy is a long-standing power solution.
Accessibility to a cost-effective electricity supply is rendered via Solar PV Technology during the lifespan of the system. Both commercial & residential customers can convert to RE (Renewable Energy), slashing their electricity bills.
Net Metering in Pakistan: How to Apply?
Net Metering Application: Every applicant who complies with the DG’s requirements as specified in NEPRA’s regulation, presents his/her application together with the required documents to the applicable DISCO office.
Acknowledgement of the application: The receipt of the application will then be acknowledged by the DISCO, which will notify the applicant if the application is perfectly completed. This will be done within 5 working days after the application is received.
In case an application form is incomplete: If any applicable information is incomplete or you don’t submit required document, the applicant will be informed to provide such information or document to the DISCO within the period of 7 days after being given notice.
Initial Review: After the DISCO receives your application, completed as required, it will conduct a preliminary review, determining if the applicant is qualifying for the interconnection amenity, whilst fulfilling the additional demands.
This preliminary review will be completed within 20 working days.
Preliminary review: Technical feasibility
Where the preliminary review discloses that the proposed amenity is unacceptable, the application will be returned by the DISCO within 3 working days and inform the applicant of the reason.
After the DISCO office finds the applicant is qualified to be a DG, the two parties will sign an agreement. This will happen in ten working days.
A copy of this agreement between the two parties, the applicant & DISCO will be dispatched to NEPRA together with the application to issue a generation license in 7 working days after the agreement was signed.
Connection Charge Estimate
After this agreement, should the DISCO determine that a modification or upgrade of the network is essential, the DISCO will provide the applicant with a CCE (Connection Charge Estimate) for the suggested interconnection amenity up to the point of interconnection, which includes the installation of the meter.
Applicants who need no modification or upgradation, will not receive a CCE, directly after the agreement.
CCE: Payment of
The CCE (Connection Charge Estimate) will be deposited by the applicant in the applicable Bank after which he or she will inform the office of the DISCO in writing.
This payment should be paid as suggested in the CCE, dispatched by the DISCO in 20 days after it was issued.
After the payment of the applicant, the installation & commission by the DISCO office will be proceeded within 30 days of the suggested interconnection amenity. This becomes due after the generation license is confirmed by NEPRA to the Distributed Generator.
The charges which will be paid for the authorization of net metering in Pakistan at the suggested facility are as stated below:
- The Distributed Generator will be responsible for paying all-inclusive costs related to the interconnection amenities up to the point of interconnection which will include the installation of the meter.
- The Distributed Generator can manage additional costs fairly acquired by the DISCO operating. Providing & maintaining interconnection amenities as well as improvements of the system can be fixed by him as well.
- A once off fee, as stated below, will be paid by a Distributed Generator via a pay order to NEPHRA for the issuing of a generation license.
Fee payable by applicant Size of DG amenity / facility
Free 0 to 20 kilowatt
Rs. 500 20 to 50 kilowatt
Rs. 1,000 50 to 100 kilowatt
Rs. 5,000 100 to 1000 kilowatt
Frequently asked questions about net-metering in Pakistan
- Net metering in Pakistan: What is it?
Through net metering DISCOs (Distribution Companies) permits their customers to install an RE (Renewable Energy) facility, onsite. This amenity/facility may not be below 1KW (kilowatts), whilst not surpassing 1 MW (megawatts) in its capacity.
In this way they are able to create energy for sustaining themselves. At the ending of every billing cycle, the Distributing Company will be netting off the kWh which the DG supplied at off-peak, against the supplied kWh by the DG.
- Is net metering in Pakistan already available?
NEPHRA (National Electric Power Regulatory Authority) of Pakistan, adopted the regulation of the Generation; Transmission & Distribution of the Electric Power Act – Act 1997 section 7(1) on 1 September 2015 which approves the Rules and Regulations which enables the Net Metering Program for RE (Renewable Energy).
- Which kinds of power generating amenities are acceptable for net metering?
Renewable Energy facilities like wind & solar energy systems, not surpassing 1MW in generating power capacity, which is efficient to install inside the premises of the customer, are allowed to partake in Pakistan’s program of net metering.
Net metering in Pakistan: eligibility criteria
- Qualification to partake in the program of net metering?
Any person who complies with the conditions of a Distributed Generator as specified under NEPHRA’s regulation 2(k) concerning its net metering rules, is competent to partake in the program of net metering in Pakistan.
Regulation 2(k): “Distributed Generator means a distribution Company’s 3 phase 400V or 11kV consumer i.e. domestic, commercial or industrial and who owns and/or operates the Distribution Generation Facility and is responsible for the rights and obligations related to Agreement and licensed by Authority under these regulations.”
- As a customer, receiving my power provision from a substantial supplier such as Bahria Town, will I be allowed to partake in the program of net metering in Pakistan?
According to the Rules & Regulations of NEPHRA it is clearly specified that a DISCO’s consumers are competent for participating in the process of net metering.
As far as Bahria Town is concerned, it purchases it’s power from LESCO, after which it distributes the electricity to their consumers, in other words, it is a distribution company.
Thus, any consumer receiving its power from a substantial supplier, such as Bahria Town can qualify for the program of net metering in Pakistan. This will depend on the substantial supplier’s willingness, whether it meets with the criteria as specified in the Net Metering Regulations of NEPHRA of 2015.
- As a customer who is connected directly to the transmission-grid, will you be eligible to partake in this net metering process?
The answer is no. Customers, with a direct connection to the transmission-grid don’t qualify as DISCO clients, but are actually NTDC (National Transmission and Dispatch Company) customers.
Net metering in Pakistan: how it works
- How will the import & export of energy work on my DISCO meter?
One bi-directional meter will be installed by the Distribution Company with the ability to import & export power. However, the Distribution Company (DISCO) can go for installing two meters which are unidirectional.
One meter will be metering the energy you purchase from your district’s DISCO, whilst the other one will be metering the energy you will be exporting to the DISCO.
- Who will receive the power which I will export through my meter?
In general customers living nearby will receive your exported solar electricity.
- What advantages will I receive if I opt for net metering?
By producing energy to sustain your own needs, you will decrease the quantity of power you will have to purchase from your district’s DISCO.
The tariff of the savings on self-produced electricity for your own need, is similar to the retail (off-peak) of the DISCO’s tariff, which consists of transmission, charges for generation, distribution, system loss, taxes, subsidies as well as other charges.
You can also receive credit on your power bill of the following billing cycle on all surplus electricity which is exported to the Distribution Company, equal to the Distribution Company’s blended generation price, but will exclude other generation adaptations.
- Would the power I am exporting to the grid be deducted from the electricity which I will import from the grid?
The client will receive a monthly bill of his net export and import, which will indicate in addition, the net export of power into the grid, conversely the net energy imported from the grid.
However, in the event of a net import bill, it will be the DG which will be charged for the net kWh, according to the applicable rate.
- What will happen if the power exported surpasses the power imported?
In such an event the DG’s follow up billing cycle will be credited with the net kWh.
- Will a client get paid by the Distribution Company in PKR for his export of excess power to the grid?
The Distributed Generator receive a net export statement every month, the Distributing Company will be responsible to pay for this net export power as per off-peak tariff in PKR on a quarterly basis.
- Installing a PV plant, without participating in the net metering process, what is the difference?
If the client did not sign an agreement for net metering in Pakistan, with a DISCO, all excess energy generated, which is not utilized at that instant, would be wasted.
On the other hand, the system can be net metered, the power meter will be running backwards, whilst providing a credit towards the power which is utilized at night or any other period of time when the power consumption surpasses the system’s output.
Net metering in Pakistan: renewable energy (re) system
- A Renewable Energy facility’s maximum size I may install at my property?
The maximum size of a RE amenity can just be ascertained after you have taken into account the number of operating hours, load of your household, pattern of demand, how much space your rooftop offers for installing a solar system.
Net metering in Pakistan: the economics
- At which tariff will the Distribution Company purchase the power which my system had generated?
NEPHRA, will determine the off peak tariff, occasionally, which will be the applicable rate for selling energy to the Distributing Company.
The off peak rate can be checked on your utility bill which is issued by the DISCO.
- Which period of time will it take for returning my investment?
In general, the payback period will be different as it depends on the utilization & size of your system. Usually the payback period differs from 7 to 10 years, for residential clients, 6 to 9 years for commercial consumers, whilst it will normally be 5 to 8 years for industrial consumers.
As mentioned above the payback time will be dependable on the following factors:
- Size of the system
- Solar resource availability
- Utilization of the system
- The system’s O & M
- Number of sunny days
- What to do if a customer wants to upgrade or modify the distributed generation amenity/facility?
When you are considering modifying any material of your distributed generation amenity, the DISCO must be notified in advance, for at least 40 working days.
- What to do when I plan to discontinue the process of net metering in Pakistan?
When a DG considers to terminate the selling of energy to the DISCO, such a Distributed Generator should notify the DISCO 30 days in advance. This will make it possible to discontinue the agreement signed between the DISCO and the DG.
After studying about net metering in Pakistan you may say, It is a great option to produce your own Renewable Energy in Pakistan, seeing this option against the backdrop of the fact that the country has power blackouts as well as load shedding, due to the fact that it has an enormous 4000MW shortfall of energy.
We advise you to Google all the other information you will need on the Internet to make an informed decision about becoming a Distributed Generator.