The government has submitted a proposal to the International Monetary Fund (IMF) to revise electricity tariffs for net metering, aiming to reduce the rate at which surplus solar power is purchased from consumers.
Currently, excess electricity generated by solar panel owners is bought at Rs. 27 per unit. However, under the new proposal, this rate could drop to around Rs. 10 per unit.
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The IMF has reviewed the plan and raised concerns about how the government will manage solar users who operate independently of the national grid.
Officials have highlighted the rapid growth of solar installations in the country, which is expected to increase further in the coming years. The government has stressed the need for tariff adjustments to ensure the sustainability of the power sector.
At present, there are 104 operational power plants nationwide, including 18 government-owned and 86 independent power producers (IPPs).
To improve efficiency, the government has shut down five underperforming plants and renegotiated tariffs with 14 IPPs, including reductions for eight bagasse-based plants. Discussions with remaining IPPs are ongoing.
Officials also noted that lower debt servicing costs, amounting to Rs. 1.3 trillion, could help create fiscal space to support electricity tariff reforms. These efforts, they claim, are aimed at reducing the baseline tariff for consumers.
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