Solar setback

The 18 per cent sales tax on imported solar panels in the FY2025-26 budget has sparked widespread criticism. Pakistan, one of the largest importers of solar panels, is expected to face a significant price increase due to this policy. Additionally, a new solar net-metering policy introduced a few months ago lowered the buyback rate for surplus solar electricity from Rs27 per unit to Rs10.

Combined with heavy taxation on solar energy, these changes could slow Pakistan’s transition to renewable energy, discourage investment and burden consumers – particularly in a country already grappling with power shortages and high electricity costs.

Nabeel Badr

Islamabad