The Slowdown of Pakistan’s Solar Momentum

Laws & Taxes 02 Mar 2026

The government’s transition from net metering to a more restrictive net billing system under the Prosumer Regulations 2026 has fundamentally altered the economics of solar energy in Pakistan. By forcing consumers to sell excess electricity back to the grid at significantly lower rates than they pay to import it, the new policy has drastically extended the payback period for solar investments and cooled a market that was previously the fourth largest in the world for solar imports. This slowdown poses a direct threat to Pakistan’s $100 billion export target, as industries particularly textiles urgently need cheap, green energy to comply with the European Union’s upcoming carbon taxes and remain competitive against regional rivals. Consequently, as policy uncertainty drives a sharp decline in solar panel imports, the market is shifting toward smaller, self-sufficient systems and increased battery storage, leaving the country to weigh the short-term goal of protecting grid revenue against the long-term necessity of a sustainable energy transition.

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