Pakistan is preparing to connect solar energy to its power grid and implement net metering to encourage users to go solar, says a report from Trust.org.
In the 2014-2015 Budget, Pakistan government announced a number of steps to boost solar industry including the abolition of 32.5 percent tax imposed on imported solar equipment. This is likely to cut the cost of solar panel installations.
The Ministry has also announced mortgage financing for home solar panels as well as rooftop solar installations.
Net-metering is a sophisticated system and allows users to sell surplus power to the national grid.
Consumer who plans to sell solar power need to register with the authority first, after which he will be responsible for the installation of the equipment.
The billing mechanism of net metering helps to credit solar energy system owners for the electricity they add to the national grid.
If a solar system in a house uses more grid power than it supplies to the grid, then it will be billed each month for that excess power and if it supplies more electricity than it uses in a month, then it will receive a credit against future bills or, be paid for the power on an annual basis.
Nevertheless, the tariff applicable for purchase of electricity from the consumer will be the same at which he has been billed by the company.
“The initiative will help scale up demand for solar energy across Pakistan and we hope the increased demand will also result in sufficient decreases in the price of solar equipment,” said Asjad Imtiaz Ali, chief executive officer, Alternative Energy Development Board.
Recently, the State Bank of Pakistan and the Alternative Energy Development Board allowed the financing for rooftop solar installation with home mortgages.
Moreover, owners of solar companies have plans to install rooftop solar on 100,000 homes in Lahore, Karachi, Rawalpindi and Islamabad in next two to three years, with financing aid from Bank Alfalah Limited.
Under the banner “Green Market,” financing up to five million rupees (around $50,000) for rooftop solar installation will be launched in the first quarter of 2015.
The program will allow buyers to borrow against their home’s value that will continue for five years.
In 2013, Pakistan’s private sector imported 350 megawatts of solar panels which dropped to 128 megawatts in 2014 after the government imposed taxes on import of the panels.
It is expected that the private sector will import around 800 megawatts of solar panels in 2015.
Sabeena Wahid