Rooftop Solar in India: Does It Actually Pay Back on Your Roof?

The only number that matters at the start is your average monthly consumption in units (kWh), printed on every DISCOM bill. Find the last twelve months and average them, not just the summer months, which inflate the figure. A household averaging 300 units a month needs roughly a 3 kW system under standard Indian sunlight conditions. A household averaging 150 units needs closer to 1.5 kW. Installers quoting system size before asking for your bills are guessing, and the guess usually runs high.

The second number is your per-unit tariff, including fixed charges divided across your units. In most urban Indian states this sits between ₹5 and ₹9 per unit for residential consumers, but the slab structure matters: if you cross into a higher slab, solar savings land in that slab first, which makes payback faster. Pull both figures from your bill before any conversation with a vendor.


The central government's PM Surya Ghar Muft Bijli Yojana offers a direct subsidy of ₹30,000 for a 1 kW system, ₹60,000 for 2 kW, and ₹78,000 for 3 kW and above, credited directly to your bank account after installation through an empanelled vendor. Several states layer an additional subsidy on top; Maharashtra, Rajasthan, and Gujarat have each run their own schemes at various points. Check your state DISCOM's portal for the current figure, these change and a number from a vendor's pitch deck may be a year out of date.


The subsidy applies only to grid-connected rooftop systems installed through vendors registered on the National Portal for Rooftop Solar. An off-grid system, however good the price, gets nothing. Verify the vendor's registration number on the portal before paying any advance.


Once you have consumption, tariff, system size, and post-subsidy cost, the payback calculation is arithmetic. A 3 kW system in a city with five peak sun hours per day generates roughly 360 to 450 units a month. At ₹7 per unit that is ₹2,520-₹3,150 saved monthly. If the post-subsidy installed cost is ₹1.2 lakh, payback sits between 38 and 48 months, three to four years. At ₹5 per unit the same system takes five to six years.

The variables that stretch payback beyond seven years: a north-facing roof with partial shading, a tariff below ₹5, a system sized significantly above your consumption (the surplus fed back to the grid under net metering earns less than what you pay to buy units), or an installer who quoted a higher capacity than your load requires. A south- or west-facing roof with no tree cover and a tariff above ₹7 is where the economics are genuinely strong.

Under net metering, surplus units your system exports to the grid are credited against your bill at a rate set by your state electricity regulatory commission. This rate is almost always lower than the retail tariff you pay, often by 30 to 50 percent. Sizing a system to export large amounts is therefore a weaker strategy than sizing it to consume most of what it generates. The sweet spot is a system that covers 80 to 90 percent of your consumption, leaving a small grid draw rather than a large export.

Net metering rules also vary by state and by DISCOM. Some cap system capacity at the sanctioned load of the connection. Some require a separate export meter. Get the current rules from your DISCOM in writing, not from the installer, whose interest is in selling the largest system that qualifies for subsidy.

Panel degradation runs at roughly 0.5 percent per year for quality monocrystalline panels, a figure the Bureau of Energy Efficiency uses in its assessments. Over twenty-five years, output drops to around 88 percent of rated capacity. Factor this into any long-term projection an installer gives you: a twenty-five-year savings figure that uses year-one generation throughout is overstated.

Inverter replacement is the cost most five-year projections omit. String inverters typically need replacement between year ten and fifteen, at a cost of ₹15,000 to ₹40,000 depending on capacity. Microinverters last longer but cost more upfront. Ask the installer which type is in the quote and what the replacement cost history looks like.

Maintenance, panel cleaning every one to two months in dusty Indian conditions, annual inspection, runs ₹3,000 to ₹8,000 a year depending on system size and whether you have a service contract. Dust accumulation alone can reduce output by 15 to 25 percent in summer months if panels go unwashed. This is not a reason to avoid solar; it is a line item the payback calculation needs.

The roof itself: a system weighs 10 to 15 kg per panel. An RCC slab in good condition handles this without structural work. An old asbestos or tin roof may need reinforcement or replacement first, which changes the economics entirely. Get a structural assessment before committing if the roof is more than twenty years old or shows any visible wear.