Govt plans to scrap licensing, fees for small solar systems

April 26, 2026 (MLN): Pakistan’s Power Division has formally approached the National Electric Power Regulatory Authority (NEPRA) to abolish licensing requirements and waive fees for small-scale solar consumers.

This development is indicating a policy pivot aimed at accelerating distributed renewable adoption.

The proposal, issued on Sunday under directives from Energy Minister Sardar Awais Ahmad Khan Leghari, seeks amendments to the existing regulatory framework governing “prosumers”, consumers who both generate and consume electricity.

Under current rules, even users with relatively small rooftop solar systems are required to secure approvals from NEPRA and pay application fees, a process widely viewed as cumbersome and cost-inefficient for households and small businesses.

The Power Division has recommended that systems with an installed capacity of up to 25 kilowatts be exempted from both licensing and associated charges.

The move, if approved, would effectively remove a key administrative barrier for residential and small commercial users seeking to install rooftop solar solutions.

The request comes at a time when Pakistan is witnessing a surge in decentralized solar adoption, driven by persistently high grid tariffs, unreliable supply, and a growing shift toward energy self-sufficiency. I

Industry stakeholders have long argued that regulatory frictions, particularly for low-capacity systems, have slowed the pace of adoption despite favourable economics.

By eliminating upfront compliance costs, policymakers appear to be prioritizing rapid expansion of small-scale solar as part of a broader strategy to ease pressure on the national grid and reduce reliance on imported fuels.

The proposal also aligns with efforts to formalize and streamline the country’s evolving net-metering and distributed generation landscape.

NEPRA is expected to review the recommendation in the coming weeks. Any revision to the prosumer regulations would require formal approval by the authority before implementation.

The development showcased a gradual shift in Pakistan’s energy policy, where enabling consumer-led generation is increasingly seen as a necessary complement to large-scale capacity additions amid fiscal constraints and rising demand.

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