When the government announced that electricity consumers would be shifted from net metering to net billing, the backlash was immediate. Households and businesses that had invested in rooftop solar felt blindsided by a policy that would sharply reduce the value of excess electricity they send to the grid. Facing public anger and market uncertainty, officials have since signaled a partial retreat. But the episode revealed something deeper: Pakistan is struggling to decide what kind of energy economy it wants to build.
At first glance, Pakistan’s official data suggest a curious phenomenon. The economy, population and urban footprint are expanding, yet recorded energy consumption appears subdued. Is growth being decoupled from energy use? Or are the statistics missing a quiet transformation underway?
A closer look suggests the latter. Official accounting methods fail to capture distributed solar photovoltaic generation at scale. In fiscal year 2023-24 alone, rooftop solar may have produced 19 terawatt-hours of electricity — a figure largely invisible in conventional energy balance sheets. That omission distorts the national picture and underestimates the country’s true energy use.
The implications are significant. Distributed solar is not marginal. It has already displaced roughly 5 million tons of oil equivalent to primary fossil fuel demand in FY24. In a system where nearly 60 percent of primary energy is lost through conversion, transport and end use, replacing fossil inputs with direct electricity generation is not merely environmentally desirable; it is physically more efficient.
Pakistan’s fossil fuel dependence carries macroeconomic costs. Energy imports routinely strain the current account and expose the country to external price shocks. The policy paper’s estimate that 48 gigawatts of imported solar capacity, if fully deployed, could avoid $100 billion to $120 billion in fuel imports over its operational life is not an environmental talking point. It is a balance-of-payments calculation.
The net metering controversy, then, is not just about tariff design. It is about whether policymakers recognize that distributed solar has already become a material component of national energy supply. Penalizing it through abrupt regulatory shifts risks slowing an adjustment that is quietly strengthening energy security.
Electrification offers a high-efficiency pathway forward. By shifting end uses toward electricity generated from solar, Pakistan can reduce its primary energy requirements even as economic output grows. In effect, the country can move toward becoming an “electro-state” — one where economic resilience is anchored in domestic, renewable power rather than imported fuels.
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