With increasing global focus on sustainable development and energy transition, Pakistan has taken significant steps to promote renewable energy sources such as solar, wind, biomass, and hydropower. The government aims to generate 60% of its electricity from clean energy by 2030 under the Alternative and Renewable Energy (ARE) Policy 2019. As a result, registering and operating a renewable energy company in Pakistan offers immense growth potential. This article presents a complete step-by-step guide on how to register a renewable energy company in Pakistan, covering incorporation, licensing, regulatory approvals, and operational compliance.

Overview of the Renewable Energy Sector in Pakistan

The renewable energy sector is regulated and facilitated by several federal and provincial institutions:

• Alternative Energy Development Board (AEDB) – primary facilitator for ARE projects

• National Electric Power Regulatory Authority (NEPRA) – issues generation licenses and sets tariffs

• Securities and Exchange Commission of Pakistan (SECP) – governs company incorporation

• National Transmission and Dispatch Company (NTDC) and CPPA-G – manage power evacuation and power purchase agreements

• Provincial Energy Departments – issue approvals for distributed generation

• Board of Investment (BOI) – handles foreign investment permissions

Step 1: Decide the Type of Renewable Energy Business

Before registering the company, determine the nature of your renewable energy venture. Common business models include:

1. Independent Power Producer (IPP) – setting up solar or wind farms to sell electricity to the national grid
2. Net Metering Installer or EPC Contractor – selling and installing solar systems for industrial, residential, or commercial use
3. Equipment Importer/Distributor – dealing in solar panels, inverters, turbines, etc.
4. Operation and Maintenance (O&M) Services – providing maintenance for renewable energy infrastructure
5. Off-grid Energy Solutions Provider – supplying solar home systems or mini-grids to rural areas

Each model has specific licensing and technical requirements.

Step 2: Incorporate the Company with SECP

To start legally, the renewable energy business must be registered with the Securities and Exchange Commission of Pakistan (SECP). Key steps:

• Choose the business structure: Private Limited Company, Public Limited Company, or Single Member Company

• Reserve a company name via SECP’s e-Services Portal

• Prepare and submit incorporation documents:

  • Memorandum and Articles of Association with renewable energy-related objectives

  • Form 1, Form 21, Form 29

  • Copies of CNICs or passports of directors and shareholders

  • Proof of registered address

  • Payment of registration fee based on authorized capital

Once processed, SECP will issue the Certificate of Incorporation and Company Registration Number (CRN).

Step 3: Register with FBR and Provincial Tax Authorities

Register your company with the Federal Board of Revenue (FBR) at IRIS Portal:

• Obtain National Tax Number (NTN)

• Register for sales tax if your business involves taxable services or imports

• Declare withholding agent status for tax deduction responsibilities

Also, register with relevant provincial revenue authorities (PRA, SRB, KPRA, BRA) if providing solar installation or engineering services which attract sales tax on services.

Step 4: Open a Corporate Bank Account

Use your incorporation certificate, NTN, and company documents to open a business bank account. For foreign companies or investors, the bank must verify foreign capital remittance in USD or other convertible currencies and issue a remittance certificate, required later by AEDB and SBP.

Step 5: Obtain AEDB Registration

The Alternative Energy Development Board (AEDB) facilitates private sector participation in the renewable energy sector. For companies engaged in:

• Net metering installation

• EPC contracts for solar or wind projects

• Supply and installation of off-grid systems

• O&M for renewable plants

You must obtain AEDB registration under the AEDB Certification Regulations. Requirements include:

• Application form

• SECP Certificate of Incorporation

• Company Profile and experience portfolio

• List of technical staff and engineers

• Financial statements or bank certificate

• Proof of completed projects (if any)

• Equipment compliance certificates (Tier 1 solar panels, inverters, etc.)

Once approved, AEDB issues a Certificate of Registration valid for 1 to 3 years.

Step 6: Apply for Net Metering Authorization (if applicable)

If your company wants to provide net metering installation services, it must be certified as an installer/vendor under NEPRA’s Distributed Generation and Net Metering Regulations, 2015.

• Apply through AEDB with a complete application

• Submit technical qualifications and vendor agreements

• Demonstrate compliance with IEC and IEEE standards for solar inverters and meters

• Approved companies are listed on AEDB’s certified vendor list

• Customers will use your services to apply for net metering through DISCOs like LESCO, IESCO, MEPCO, etc.

Step 7: NEPRA Licensing for Power Generation (For IPPs)

If your business involves setting up a power plant (e.g., solar farm, wind power, biogas unit), you must obtain a Generation License from NEPRA. Follow these steps:

• Submit an application for generation license under NEPRA’s Licensing (Generation) Rules, 2000

• Include feasibility study, technical design, grid interconnection study, and site location

• Submit proof of financial capability (bank statements, investor backing)

• Sign a Letter of Intent (LOI) with AEDB

• Complete Environmental Impact Assessment (EIA) and get NOC from EPA

• Sign Energy Purchase Agreement (EPA) or Wheeling Agreement with CPPA/NTDC

NEPRA then grants the Generation License for up to 25–30 years.

Step 8: Grid Interconnection and Power Evacuation (for IPPs)

Once NEPRA license is secured, coordinate with the National Transmission and Dispatch Company (NTDC) or respective DISCO for:

• Grid Interconnection Studies

• Power Evacuation Agreements

• Installation of metering infrastructure

• Signing of Energy Purchase Agreement (EPA) or Wheeling Agreement

Power Purchase Agreements (PPAs) are negotiated based on the tariff determined by NEPRA, using Levelized Cost of Electricity (LCOE) methodology.

Step 9: Compliance with Environmental and Safety Regulations

Whether the project is utility-scale or rooftop-based, environmental regulations apply. You must:

• Submit Initial Environmental Examination (IEE) or Environmental Impact Assessment (EIA) to the respective Environmental Protection Agency (EPA)

• Ensure waste disposal, battery management, and solar panel recycling policies

• Obtain NOC from local District Administration or Tehsil Municipal Authority (TMA) for site use

Safety protocols must comply with NEPRA’s Grid Code and Electrical Safety Regulations.

Step 10: Register with Other Relevant Bodies

Depending on the nature of your business, additional registrations may be required:

• Pakistan Engineering Council (PEC) – for EPC contractors

• Pakistan Software Export Board (PSEB) – if involved in energy software or IoT

• Pakistan Customs (WeBOC) – for import of solar panels, inverters, and batteries

• Pakistan Council of Renewable Energy Technologies (PCRET) – for technical validation and R&D support

• PSQCA – for certification of imported equipment

• Pakistan Standards and Quality Control Authority (PSQCA) – for quality compliance

Step 11: Apply for Tax and Import Incentives

Renewable energy companies are eligible for various fiscal incentives including:

• Zero customs duty and sales tax on solar panels, wind turbines, inverters (under SRO 575(I)/2006 and SRO 1125(I)/2011)

• Exemption from income tax for 5–10 years for new renewable energy projects under Second Schedule of Income Tax Ordinance

• Accelerated depreciation for plant and machinery

• Duty-free import of capital goods

• Export benefits under Strategic Trade Policy Framework (STPF) for solar exports

These require submission of supporting documents to FBR, Engineering Development Board (EDB), and Ministry of Industries.

Step 12: Maintain Ongoing Compliance and Reporting

Once operational, the renewable energy company must:

• File annual income tax returns and sales tax returns monthly

• Maintain withholding tax compliance under Sections 149, 153, 152 of Income Tax Ordinance

• Submit performance reports to AEDB and NEPRA

• Renew AEDB and NEPRA licenses before expiry

• Monitor and report grid export data if using net metering

• Cooperate with discos for safety and inspection audits

Timely compliance ensures continuation of licenses and eligibility for future tenders or incentives.

Timeline and Estimated Costs

Opportunities in Pakistan’s Renewable Energy Sector

The renewable energy landscape in Pakistan is rapidly evolving. Key areas of opportunity include:

• Net metering and distributed generation for commercial and residential clients

• Corporate Power Purchase Agreements (CPPAs) for industrial zones

• Green financing via SBP’s Refinance Scheme for Renewable Energy

• Electric vehicle (EV) charging infrastructure powered by solar energy

• Smart grid and battery storage integration

• Solar irrigation and rural electrification

International donors like World Bank, ADB, GIZ, and USAID are actively funding Pakistan’s clean energy transition, creating partnerships for local firms.

Conclusion

Registering a renewable energy company in Pakistan requires a structured approach beginning with company incorporation, AEDB registration, NEPRA licensing (if applicable), and compliance with environmental, tax, and import regulations. Whether your business is focused on solar net metering, utility-scale IPP projects, or EPC contracts, understanding and fulfilling the licensing requirements is critical. With strong policy support, tax incentives, and growing demand for clean energy, Pakistan offers a promising environment for renewable energy entrepreneurs, developers, and investors aiming to contribute to a sustainable future.