Nepra abolishes licence requirement, fee for small solar users

Lead

Pakistan's National Electric Power Regulatory Authority (Nepra) has withdrawn the requirement for a generation licence and the associated fee of Rs1,000 per kilowatt for solar net-metering consumers with capacity up to 25kW, effective February 9, 2026. The decision, announced on Tuesday, comes two days after the Power Division — acting on directives from Power Minister Awais Leghari — formally asked Nepra to review and remove the licence and fee requirement for solar consumers of 25 kilowatts and below.

The regulatory rollback restores the practice under the 2015 regulations, under which distributed generation systems of 25kW or below did not require a Nepra licence and were processed directly by distribution companies (Discos) without any fee. The revised prosumer regulations, which centralised approval authority with Nepra and imposed application fees even for small installations, had drawn sharp public criticism and objections from industry bodies.

Coverage Comparison

Dawn's reporting, based on two articles, consistently confirms that the regulatory change stems from the Power Division's directive. The first article, published on the day of Nepra's notification, focuses on the implementation, stating the authority "withdrew ab initio" the licence requirement and fee. The second article, published earlier, details the Power Division's decision and the factors that led to it, including public criticism for "taxing sunlight" and the adverse effects the move could have on the national drive toward alternative energy adoption.

While one piece adopts a slightly more critical tone, using the phrase "taxing sunlight" to describe the previous fee, the overall reporting aligns on the core facts: the fee is eliminated for smaller systems, higher-capacity prosumers (above 25kW) still face a one-time fee of Rs1,000 per kilowatt, and the notification is retroactive to February 9, 2026.

Key Claims

• Nepra has withdrawn the licence requirement and the fee of Rs1,000 per kilowatt for solar net-metering consumers up to 25kW, as reported by Dawn.
• The Power Division directed Nepra to abolish the fee and the licence requirement for systems below 25kW, per the same source.
• The regulatory reversal follows the public criticism and formal objections from industry stakeholders at both public hearings and through the Private Power and Infrastructure Board (PPIB), which had flagged the negative consequences of the earlier decision.

Perspectives

Regulatory Perspective

Nepra has complied with the government's directive, citing the need to ease the approval process for small consumers and reduce financial burdens. The authority's notification acknowledges that the change is necessary to keep pace with national efforts to promote solar energy and to avoid discouraging residential adoption.

Government Perspective

The Power Division, under instructions from Minister Leghari, acted to address the public backlash against the original fee, which had become politically untenable. The division argues that the previous 2010 regulations were more streamlined and that the new fee structure threatened the government's agenda for renewable energy expansion. It also highlights the earlier advice it said it gave to Nepra about the adverse effects of the decision.

Industry and Consumer Groups

Organisations such as the Pakistan Solar Association and Siddique Renewable Energy had formally objected during public hearings, claiming that moving approval authority from Discos to Nepra would create unnecessary administrative barriers. They also argued that the fee imposed an unfair burden on small residential and commercial users. Their voices were instrumental in prompting the reversal.

Context and Corrections

The decision to abolish the fee beings forth mobile net-metering users relief, but the development also clarifies a lingering ambiguity. The notification is effective retroactively from February 9, 2026, meaning that users who may have paid fees after that date could be entitled to refunds, though no specific mechanism has yet been mentioned. Including the PPIB's flag of inconsistency with prior approvals, the broader context shows that the original regulatory shift was met with institutional and public scrutiny, ultimately leading to this correction.

As the country pushes to expand alternative energy sources, the revision signals a conciliatory approach from the government toward small-scale consumers, but it remains to be seen how the new policy will be implemented at the distribution company level and whether the Pakistan Solar Association’s broader concerns about bureaucratic hurdles will be fully addressed.