NEPRA Cut Prosumer Contracts to 5 Years: What It Means for Your Solar Payback and System Size

• By Best Solar Company PK
• 21 Jul, 2026
• Net Metering
• 8 min read

On 9 February 2026, NEPRA formally notified the **Prosumer Regulations 2026**, retiring the Net Metering Regulations that had governed rooftop solar since 2015. Most of the coverage focused on the switch from net metering to net billing and the collapse in the export (buyback) rate. But one change is getting far less attention than it deserves: the **standard grid agreement has been cut from 7 years to 5 years**.

For a new buyer signing up in 2026, that missing two years quietly changes almost every number on your quotation. Here is what actually shifts, and how to size and cost your system so the shorter term works for you rather than against you.

What the new rules actually say

Three linked changes matter for your maths:

• **Contract term: 5 years, not 7.** The standard prosumer agreement now runs for five years, extendable only "with mutual consent" of you and your distribution company (DISCO). The old regime locked in 7 years.
• **Net billing replaces net metering.** Instead of a one-for-one unit swap, your export and import are now settled separately. Units you send to the grid are bought at a fixed rate — roughly **Rs 10–11 per unit for new prosumers** — while every unit you pull from the grid is charged at the **full retail tariff** (commonly Rs 45–65 per unit in the higher residential slabs).
• **System size capped at 100% of sanctioned load.** Previously you could install up to 150% of your connection's sanctioned load. Now your inverter capacity cannot exceed your approved load.

Existing net-metering consumers keep their old 7-year contracts and the higher ~Rs 26/unit rate until those agreements expire — the new terms apply to **new applicants and anyone re-signing**. If you are buying now, you are in the new world.

Why the 5-year term changes the payback conversation

Under net metering, the 7-year contract was a comfort blanket. Even a slightly oversized, export-heavy system would pay for itself, because every exported unit was worth almost as much as a retail unit and you had seven guaranteed years to bank them.

Net billing breaks that. An exported unit at Rs 11 is worth barely a fifth of a self-consumed unit that offsets Rs 55 of grid electricity. So the value of your system now lives almost entirely in **electricity you use yourself, in daylight, as it is produced**. Two years less of guaranteed terms sharpens the pressure to reach payback quickly — before renegotiation, before rates potentially fall again.

The practical rule for a 2026 buyer: **aim to reach payback comfortably inside the 5-year window — ideally in 3 to 4 years — so the system is fully "paid" while your contract terms are still locked.** After year five, your DISCO could revise the buyback rate downward, and you will have far less leverage.

The new payback maths, with real figures

Take a typical **10 kW on-grid system**, currently around **Rs 1.6 million** installed, plus roughly **Rs 100,000–150,000** for the net-metering file, bidirectional meter and processing. Call it **Rs 1.75 million** all-in. In most of Pakistan a 10 kW array generates about **14,000–15,000 units a year**.

**Scenario A — you self-consume 70% (the smart target):**

• Self-used: ~10,200 units × Rs 55 saved = **Rs 561,000/year**
• Exported: ~4,400 units × Rs 11 = **Rs 48,000/year**
• Total benefit ≈ **Rs 609,000/year → payback in about 2.9 years**

**Scenario B — you self-consume only 35% (an oversized, export-heavy setup):**

• Self-used: ~5,100 units × Rs 55 = **Rs 280,000/year**
• Exported: ~9,500 units × Rs 11 = **Rs 104,000/year**
• Total benefit ≈ **Rs 384,000/year → payback in about 4.6 years**

Same hardware, same cost — but Scenario A finishes paying for itself with two full years of contract to spare, while Scenario B only just scrapes in under the five-year line. The difference is entirely about **matching generation to daytime usage**, not about panel count.

How this should change your system sizing

The old instinct — "go as big as your roof and budget allow, the grid will store the rest" — is now the wrong instinct. With export at Rs 11 and a hard 100%-of-load cap, oversizing quietly destroys your return. Size for what you actually use in daylight:

• **Right-size to daytime load, not annual units.** Look at how many units your home or business consumes between roughly 9am and 5pm. That is the demand your solar can offset at full retail value.
• **Respect the 100% cap.** If your sanctioned load is 10 kW, that is your ceiling. If your daytime usage is genuinely higher, apply to your DISCO to increase sanctioned load *before* sizing up.
• **Shift loads into daylight.** Running the washing machine, water pump, pool motor or a commercial cold-room during peak sun converts cheap solar directly into savings instead of Rs 11 exports.
• **Consider a modest battery — carefully.** A battery lets you self-consume evening load, but it adds Rs 400,000–900,000+ and can *slow* payback. For most homes, shifting loads into daytime beats buying storage; batteries make more sense for businesses with heavy evening demand or frequent load-shedding.

For a deeper cost breakdown, see our guide to choosing the right system size in 2026 and our explainer on net billing vs net metering.

The bottom line for new buyers

The 5-year term is not a reason to avoid solar — payback under 3 years is still very achievable, and solar still comfortably beats paying Rs 55+ per grid unit. But it does reward discipline. Buy a **right-sized system aimed at daytime self-consumption**, keep your all-in cost tight, and target payback in **3–4 years**. Do that, and the shorter contract becomes irrelevant: your system will have paid for itself long before the agreement is up for renewal.

Frequently Asked Questions

**Does the 5-year contract mean my solar stops working after 5 years?** No. Your panels, inverter and self-consumption savings continue for the full 20–25 year life of the equipment. The 5-year term only governs your *grid interconnection and buyback agreement* — it can be extended with your DISCO's consent, most likely under whatever export rate applies at that time.

**I already have net metering on a 7-year contract. Am I affected?** No. Existing prosumers are grandfathered — you keep your 7-year term and the higher ~Rs 26/unit buyback until your current agreement expires. The new 5-year term and ~Rs 11 rate apply to new applicants and anyone signing a fresh agreement.

**Is solar still worth it now that export only pays Rs 11 per unit?** Yes, provided you size correctly. The real value is avoiding grid electricity at Rs 45–65 per unit, not the Rs 11 export rate. A system tuned for daytime self-consumption still pays back in roughly 3 years.

**Why can't I install a bigger system anymore?** The 2026 rules cap inverter capacity at 100% of your sanctioned load, down from 150%. If you need more, apply to raise your sanctioned load first — but remember that under net billing, oversizing just produces low-value exports.

**Should I add batteries to beat the low export rate?** Only if you have significant evening or night load. Batteries let you store daytime solar for later self-use, but they add substantial cost and can lengthen payback. For most homes, shifting appliances into daylight hours is cheaper and more effective than storage.

**How long does net-metering approval take in 2026?** Typically 30–90 days depending on your DISCO and city, with a file, meter and processing cost of roughly Rs 100,000–150,000. Factor this into your total system cost when calculating payback.

Best Solar Company PK designs and installs reliable solar systems in Rawalpindi, Islamabad, Lahore, Multan, Taunsa Sharif and Karachi. Contact us for a free survey and the best advice for your home or business.