Net Metering – an impending source of relief for consumers

In an era of escalating power prices, selling power to the national grid would be a source of relief for consumers as alternate energy systems installed at houses would make them earn money instead of simply being the consumers.

The net metering system enables them to sell extra electricity to Power Distribution Companies (Discos) generated easily through their solar and wind systems for years, just after one-time spending. Thousands have already converted to this system as power distribution companies are now providing them with this modern facility of selling extra electricity to the relevant distribution company.

This novel facility of selling extra electricity has already started functioning with certain companies including K-Electric awarding net-metering connections to purchase surplus electricity. “Instead of just keep paying as consumers, the clients of power distribution companies are now becoming sellers by selling their extra electricity,” said Chief Executive Officer of Islamabad Electric Supply Company (Iesco) Dr Muhammad Amjad.

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He said following successful models of several western and eastern countries, the government ultimately introduced this technology to facilitate power-producing customers. “Net metering is also an innovative and immediate solution to current power shortage in the country,” Dr Amjad stated and informed that Iesco was the country’s first power distribution company facilitating both commercial and domestic customers to generate electricity through solar panels and sell their surplus electricity to Iesco.

The net-metering project was launched countrywide in 2016, allowing any domestic, commercial, industrial and other consumers to have at least a three-phase meter connection to avail of this facility. Under the arrangement, such a consumer could sell additional energy to respective power distribution companies and make stocktaking (calculations) with it at the end of a month.

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Since the system allows the consumers to generate electricity from one kilowatt to one megawatt, the National Electric Power Regulatory Authority (Nepra) issues licences to applicants seeking generation above 25kW in the service area jurisdiction of all distribution companies. “We got an extremely encouraging response from the public. The Iesco has installed 21,218 net metering connections with a total generation capacity of 229.09 megawatts (MW) in its jurisdiction from January 2016 to October 2023,” said Iesco Public Relations Manager Asim Nazir Raja.

He said the company had received 22,174 applications for net metering connections worth 244.77 MW and so far licenses have been issued to 22,114 consumers with an accumulative capacity of 242.33 MW. Asim said the company had paid an amount of Rs2,995,823 to connection holders till March 2023.

“The system will help bridge the power generation gap, also resulting in reduced load-shedding,” remarked Nepra Chairman Waseem Mukhtar.

Solar irradiation in Pakistan and India stands at 1,900 Kwh/m2 against China’s 1,500 and Germany’s 1,200 Kwh/m2. China, Germany and India have already installed solar power projects of thousands of megawatts capacity.

According to estimates a 5KW system costing around Rs800,000 to Rs1,000,000 could generate 600 units per month and if a consumer uses an average 400 units, he can still sell 200 units.

Published in The Express Tribune, December 18^th, 2023.