THE recent imposition of certain regulatory requirements for small-scale solar systems, followed by the reversal of the decision, underscores the absence of a coherent vision for Pakistan’s transition to renewable energy. The rollback of licensing requirements and fees for solar generation capacity of 25kW or below exposes an uncertain policymaking process that, rather than following a long-term policy framework, reacted first to cost pressures as consumers shifted away from the grid, and then rescinded the move because of public backlash for ‘taxing sunlight’. Such ambiguity in energy policymaking circles shows lack of clarity: do our policymakers actually want to accelerate solarisation or do they want to manage its pace to safeguard legacy interests in the power sector? The government’s uncertainty in first subjecting small solar prosumers to licensing requirements and fees and then reversing its decision under pressure is not new.

The earlier shift from net metering to net billing — effectively diluting the financial incentive for rooftop solar — had already signalled a retreat from a pro-consumer, pro-renewables stance. The subsequent restoration of incentives to the extent of existing prosumers, followed by the reversal of new regulatory requirements now, reinforces the impression of a policy environment marked by inconsistency and hesitation. Frequent reversals not only erode investor trust but also risk slowing solar adoption by introducing regulatory uncertainty. More importantly, they dilute the credibility of the state’s commitment to clean energy transition. That said, even a clear and consistent push for solar adoption would not, on its own, address the challenges of our transition to renewables. Solarisation without storage creates its own distortions by reducing grid demand during daylight hours while leaving peak evening demand largely intact. This mismatch calls for a parallel policy push towards battery storage solutions, which can stabilise supply, smooth demand curves and enhance grid resilience. Existing taxation on batteries continues to deter widespread storage adoption, undermining the benefits of large-scale distributed solar generation. Without incentivising storage, the system risks evolving into one where solar penetration increases but grid inefficiencies deepen. This could prompt further reactive policy interventions. If the government is serious about energy transition, it should move beyond piecemeal incentives and reversals, and articulate a clear, forward-looking policy vision, defining at what scale and speed solarisation is to be encouraged.

Published in Dawn, April 28th, 2026