Amid a booming solar energy sector, the National Electric Power Regulatory Authority (Nepra) has proposed a major shift in policy, suggesting that rooftop solar consumers move from the current net metering system to a gross metering framework.
The move comes as authorities raise concerns over the growing financial burden on non-solar electricity users.
Under the draft Nepra Prosumer Regulations, an 18-page document recently uploaded to the regulator’s website, new domestic solar consumers would sell all electricity generated to distribution companies under gross metering. In this system, electricity exported to the grid would be compensated at a fixed buyback tariff, while electricity drawn from the grid would be billed separately.
Existing consumers with valid seven-year net metering contracts will continue to receive Rs22 per unit for surplus electricity until their agreements expire. New installations, however, would see a buyback tariff of Rs11.30 per unit, with contracts valid for five years and extendable on mutual agreement.
Nepra has invited feedback from stakeholders and may hold a public hearing before finalising the regulations.
Officials have pointed out that the current net metering model is creating a financial burden of up to Rs2 per unit on other consumers. Rapid rooftop solar expansion led to a 3.2 billion unit decline in grid electricity sales in FY2024, resulting in Rs101 billion in revenue losses for distribution companies and driving average tariffs up by Rs0.9 per kWh.
Projections warn that by FY2034, lost sales could rise to 18.8 billion units, translating into Rs545 billion in losses and tariff hikes of Rs5-6 per unit.
Energy authorities also warn that unchecked growth could threaten grid stability. With winter demand often falling to 8,000-9,000MW, excessive daytime solar generation may overwhelm the grid, a risk highlighted by Sri Lanka’s nationwide blackout following a solar surge.
Instances of misuse have also been reported, such as consumers exporting double their sanctioned load. Distribution companies are responding by installing smart meters capable of real-time monitoring and export control.
Nepra and the Power Division are reviewing these reforms carefully to balance the growth of solar energy with financial sustainability and grid stability, aiming to prevent further strain on conventional electricity users.
