No fixed tax being imposed on solar power, clarifies power division

In a bid to clear the air, the Power Division dismissed as “baseless” the rumours claiming the government was all set to impose a fixed tax on solar power.     

Reports were circulating on social media platforms that a summary had been moved to introduce the fixed tax on solar electricity. The reports further said that the CPPA’s proposal suggests levying a tax of Rs2,000 per kilowatt on those installing solar panels for residential or commercial purposes.

In a statement, the division stated there was no truth in the reports of solar power fixed tax.

“The Central Power Purchasing Agency or Power Division has not sent any such summary to the government in this regard.”

Hinting at cutting tariff for solar net metering, the Power Division, however, said that the prevailing system is promoting unhealthy investment in the sector.

“The well-off people are massively installing solar panels.”

The power division statement came as the rates of solar panels plummeted by over 60% in recent weeks due to bulk imports from China.

The domestic, industrial consumers and the government have to bear burden of Rs 1.90 per unit under the head of subsidy which resulted affecting 25 to 30 million consumes, as per the statement.

“If this trend continues, the bills of poor consumers would surge at least Rs 3.35 per unit, warned the power division.

It said the "Net Metering Policy 2017” was aimed at promoting alternative energy in the system.

The solarisation process witnessed a sharp increase after the policy, the division said, adding that the whole system was being reviewed.

“Now, there is a need to announce a new rate.”

The division further said that proposals and amendments were being considered to save the poor consumers from further burden.