Net metering: Nepra to hold hearing on downward revision of tariff

ISLAMABAD-Amidst a continuous denial from the Ministry of Energy over making any change to the net metering rates, National Electric Power Regulatory Authority has announced to hold hearing on downward revision of the tariff by almost 53pc.

The National Electric Power Regulatory Authority has decided to hold a public hearing on the (Alternative & Renewable Energy) Distributed Generation and Net Metering Regulations, 2015 on September 27, 2022. Federal Minister for Power Khurram Dastagir last week denying any such development of amendment in the net metering regulations tweeted that “There is no change in net metering system and price, There is no truth in the news spread regarding net metering,”. However, in actual it has been proposed by the NEPRA that “In sub-regulation 5 of regulation 14 of the regulations, for the words “national average power purchase price” the following shall be substituted, “national average energy purchase price”. As per the sub-regulation 5 of regulation 14 of the regulations, “The price payable by a Distribution Company for net kWh shall be the national average power purchase price of the Distribution Company as determined by the Authority and notified by the federal government. The proposed amendment in the Net Metering Regulations and substitution of “national average power purchase price”  with “national average energy purchase price” will cost the solar net metering distributor generators Rs 10.32/unit or around 53pc, official source in NEPRA confirmed to The Nation.

Following the rebasing of the power tariff, the per unit cost of the net metering electricity has reached to Rs 19.32/unit and the amendment in the regulations will cut it down to Rs 9/unit, the sources added. With the previous purchase rate of around Rs13/unit, the payment to net metering distributor generators would have been reduced by 30pc to Rs 9/unit. However, after the rebasing of the base tariff, the per unit cost of the net metering based electricity has increased to Rs 19.32/unit and now the distributor generator would face a cut of almost 53pc or Rs 10.32/unit, an official source confirmed to The Nation.

According to the NEPRA, the proposed amendment would not have any impact on self-consumption, as well as netting off of the units. The units would be netted off as per the already approved mechanism. The amendment in the regulations only applies to the excess units sold by net metering consumers. The impact of any higher cost paid on excess units would be shared by remaining consumers of the grid, said the NEPRA.

Last month NEPRA had invited comments from the stakeholder regarding amendment in Net Metering Regulations, 2015. NEPRA wants to abolish the capacity payments over and above Rs9/unit from the cost of the net metering-based electricity, the source said. It is worth mentioning here that the power distribution companies (Discos) are paying over Rs 1.1 trillion annually as capacity payments to the independent power producers and there is no move underway to reduce such huge payments. However, a proposal to cut the capacity payments of the Net Metering distributor generators is under process which will discourage future investment in the net metering.

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