What Is Net Metering?
Net metering is a billing mechanism that allows solar panel owners to export excess electricity generated by their system back to the LESCO grid. When your solar panels produce more electricity than you consume during the day, the surplus flows into the grid and your meter runs backward. At the end of the billing period, you are billed only for the net consumption — total usage minus total export.
NEPRA introduced net metering regulations in 2015, and LESCO has been accepting net metering applications since. The system benefits both consumers (lower bills, potential credits) and the grid (distributed generation, reduced peak demand). For Lahore homeowners, net metering combined with solar panels can reduce electricity bills by 70–100%.
Eligibility Requirements
Not all LESCO consumers automatically qualify for net metering. There are specific eligibility criteria set by NEPRA and LESCO that must be met before your application can be processed.
Net metering eligibility criteria
- Must be an existing LESCO consumer with an active connection
- Solar system capacity should not exceed your sanctioned load
- System must be installed by a qualified, licensed solar installer
- The solar inverter must be grid-tied and NEPRA-approved
- Single-phase connections: maximum 5 kW solar system
- Three-phase connections: maximum 1 MW solar system
- System must meet LESCO technical standards for grid interconnection
- Applicant must hold valid property ownership or landlord NOC
Application Process for LESCO Net Metering
- Install a solar panel system through a licensed installer — ensure the inverter is grid-tie compatible
- Obtain the installation completion certificate from your installer
- Prepare application documents: CNIC, property papers, LESCO bill copy, system specifications
- Submit the application to the LESCO Generation Licensing department with all documents
- LESCO engineering team will inspect your installation for safety and compliance
- If approved, LESCO will replace your existing meter with a bidirectional (import/export) meter
- Sign the net metering agreement specifying terms for energy export and billing
- Your net metering connection goes live — start exporting excess solar power to the grid
Required Documents
Documents for net metering application
| Document | Details | Notes |
|---|---|---|
| CNIC Copy | Applicant's original CNIC | Same as LESCO account holder |
| LESCO Bill Copy | Recent electricity bill | Shows reference number and load |
| Property Papers | Ownership or NOC from landlord | Must match LESCO account |
| Solar System Design | Panel layout, inverter specs | From licensed installer |
| Installer's License | AEDB/PEC registration | Valid and current |
| Test Reports | Inverter and system testing | Safety compliance certificate |
| Bank Details | For export credit payments | If applicable |
How Net Metering Billing Works
Under net metering, your LESCO bill is calculated based on the difference between electricity imported from the grid and electricity exported to the grid. If your solar system produces more than you consume in a billing cycle, you get a credit that carries forward to the next month.
Net metering billing example
| Metric | Value | Explanation |
|---|---|---|
| Total Consumption (Import) | 350 kWh | Drawn from LESCO grid |
| Total Export | 280 kWh | Sent to grid from solar |
| Net Units Billed | 70 kWh | 350 – 280 = 70 |
| Base Bill (70 units) | Rs 542 | First slab rate only |
| Taxes & Charges | Rs 180 | Reduced proportionally |
| Total Bill | ~Rs 722 | Instead of ~Rs 7,000 without solar |
Solar System Sizing for LESCO Net Metering
Choosing the right solar system size is crucial for maximizing your net metering benefits. A system that is too small will not offset your bill significantly, while an oversized system generates excess that may not be fully compensated at retail rates.
Recommended system size by consumption
| Monthly Usage | Recommended Solar | Approximate Cost | Bill Reduction |
|---|---|---|---|
| 200–300 kWh | 3 kW | Rs 300,000–450,000 | 60–80% |
| 300–500 kWh | 5 kW | Rs 450,000–650,000 | 70–90% |
| 500–700 kWh | 8 kW | Rs 700,000–1,000,000 | 75–95% |
| 700–1000 kWh | 10 kW | Rs 900,000–1,300,000 | 80–100% |
| 1000+ kWh | 15 kW+ | Rs 1,300,000+ | 85–100% |
Financial Benefits and ROI
The return on investment for solar with LESCO net metering depends on your current electricity bill, system size, and sunlight hours. Lahore receives an average of 5.5–6.5 peak sun hours daily, making it excellent for solar generation. Most residential solar systems pay for themselves within 3–5 years.
Financial benefits summary
- Monthly bill reduction of 70–100% depending on system size and usage pattern
- Protection against future tariff increases — your solar cost is fixed
- Property value increase — homes with solar sell for 5–10% premium
- Government incentives — no sales tax on solar equipment imports
- Net metering credits provide additional financial benefit for excess generation
- System lifespan of 25+ years with minimal maintenance costs
- Break-even period of 3–5 years for most LESCO residential consumers
Frequently Asked Questions
How do I apply for LESCO net metering?
Install a NEPRA-approved solar system through a licensed installer, then submit the net metering application to LESCO's Generation Licensing department with your CNIC, bill, property papers, and system specifications.
What size solar system do I need for LESCO net metering?
System size depends on your monthly consumption. For 300–500 kWh usage, a 5 kW system is recommended. The system cannot exceed your sanctioned load — check your LESCO bill for your load limit.
How long does LESCO net metering approval take?
LESCO typically processes net metering applications within 30–60 days. The timeline includes application review, site inspection, meter replacement, and agreement signing.
How is my LESCO bill calculated with net metering?
You are billed for net consumption: total grid import minus total solar export. If you export more than import, credits roll over to the next month.
What happens to excess solar credits at year end?
Under NEPRA rules, excess credits at the end of the annual settlement period may be compensated at the DISCO's buy-back rate, which is typically lower than the retail rate. Check the current policy with LESCO.
Can I install net metering on a rented property?
Yes, but you need a written NOC from the property owner. The LESCO connection must be in the applicant's name or the owner must authorize the application.
Does LESCO charge for the bidirectional meter?
Yes. The cost of the bidirectional meter (typically Rs 15,000–25,000) is paid by the consumer as part of the net metering setup process.
Can I use batteries with LESCO net metering?
NEPRA's net metering framework primarily covers grid-tied systems without batteries. However, hybrid systems with batteries are allowed as long as the grid-tie functionality meets LESCO's technical requirements.
What is the buy-back rate for LESCO net metering?
The buy-back rate varies by NEPRA determination. Currently it is typically equivalent to the average generation cost, which is lower than the consumer retail rate. Check the latest NEPRA notification for current rates.
Is net metering available for LESCO commercial connections?
Yes. Commercial and industrial LESCO consumers can also apply for net metering. The maximum system size for three-phase connections is 1 MW. Commercial net metering can significantly reduce operational electricity costs.