KARACHI: In the budget for 2024–2025, the government might offer some incentives to promote local solar panel assembly.
During Prime Minister Shehbaz Sharif’s recent visit to China, Mohammad Zakir Ali, Senior Vice-President of the Pakistan Solar Association (PSL), stated, “I do not think the government will impose any new taxes and duties on solar panels, which already have zero per cent general sales tax.” Only inverters are subject to 18% GST.
He stated that in response to allegations of limitations or constraints placed on China by other nations, the government has been attempting to persuade Chinese producers of a variety of goods to shift their operations to Pakistan.
According to Mr. Zakir, “no memorandum of understanding (MoU) had been signed, though multiple agreements had been inked between Chinese and local entrepreneurs in different sectors,” despite the government’s resolute commitment to advancing solarization in the nation.
During the PM’s visit to China, no Memorandum of Understanding was signed to encourage solar investment.
He believed that the government might not implement any detrimental net-metering policies, such as lowering the electricity purchase tariff from the present Rs. 21 to Rs. 12 per unit, in light of the recent uproar.
He claimed that during their discussions, Chinese investors had stated that in order to provide a safe working environment for the local panel producers, Pakistan should levy an import tariff on the arrival of completely built-up (CBU) solar panels.
He continued by saying that this will encourage more investment in the solar sector.
He continued by saying that Chinese businesses receive a refund when they ship to Pakistan or other nations, which is what they desire from Pakistan following their investment in the solar industry.
The government was forced to clarify matters following numerous media reports about the imposition of a fixed tax on citizens who produce energy through solar systems, a reduction in the power purchase rate for domestic net-metering consumers, and the replacement of net metering with a gross-metering mechanism. However, some solar panel dealers stated that the government is unlikely to address the net-metering issue.
In the third week of May, Federal Minister of Energy Awais Khan Leghari declared that the government has no intention of discontinuing the solar net-metering program.
Due to the high cost of solar panels, not many people filed for net-metering when the program was first announced in 2017. Customers who had previously installed solar electricity and were under contract with Disco for net-metering “would not be affected at all,” according to Mr. Leghari.
In the future, he said, the government will also support net-metering, and any modifications to the regulations will only be implemented after consulting with all relevant parties.
Leghari asserted that rooftop solar net-metering connections account for 0.3 percent of all electricity users. “There are now 113,000 net metering connections overall.”
