Benefits from Rooftop Solar at Home
Rooftop solar reduces electricity costs by generating power at your own premises instead of buying every unit from the grid. How much you save — and how fast the system pays for itself — depends on the type of plant you install and how your local DISCOM's net metering policy works.
How much will my electricity bill reduce?
Electricity bills across India typically have three components: Fixed Charge, Variable Charge, and Taxes & Surcharges. Rooftop solar reduces each differently depending on the system type:
| Plant Type | Fixed Charge | Variable Charge | Taxes & Surcharges | Total Bill |
|---|---|---|---|---|
| On-Grid | Not saved | Saved up to 100% | Saved | Saved up to 80–90% |
| Off-Grid | Saved up to 100% | Saved up to 100% | Saved | Eliminated |
| Hybrid | Not saved | Saved up to 50% | Saved | Saved up to 50–70% |
Which system type is right for you?
On-grid systems are the most common and cost-effective choice for homes with reliable grid power, since they're the cheapest to install and qualify for net metering. Off-grid and hybrid systems trade a lower bill-savings ceiling for battery backup during outages. See how rooftop solar works for a full breakdown of each system type and its components.
What financial return can I expect?
Net metering (available with an on-grid plant) makes solar installation especially lucrative because of how billing credits are calculated:
- You continue drawing electricity from the grid on days when your panels under-generate (cloudy days, monsoon, winter)
- Excess electricity your system generates is netted out against your total consumption, rather than paid for separately
- Generated electricity is set off against your highest-paid slab tariff, not an average rate — so net metering saves you more per unit than a flat feed-in rate would
- You also avoid the roughly 20% in taxes and surcharges typically charged on top of slab tariffs, since that portion of consumption is offset entirely
- Because grid tariffs tend to rise over time while your solar generation cost is fixed, solar becomes more valuable each year you own it — especially for households in high-tariff slabs
- With subsidies applied upfront, residential customers can reach the lowest achievable cost of electricity consumption over a 25-year system life
Simple mathematics of solar plants
Here's how the numbers work out for a typical 1 kW rooftop system over its lifetime:
| Step | Calculation | Result |
|---|---|---|
| Daily generation | 1 kW generates 4–4.5 units/day | 4–4.5 units/day |
| Annual generation | 365 days × 4–4.5 units | ~1,460–1,642 units/year |
| Adjusted for weather | Assuming ~80% of days have usable sunlight | ~1,168–1,314 units/year |
| Lifetime generation | 25-year manufacturer performance warranty (panels retain at least ~80% of rated output at year 25); assuming ~85–90% average efficiency across the system's life | ~24,820–29,565 units over 25 years |
| System cost | Cost of a 1 kW system, before subsidy | ₹65,000–₹85,000 |
| Maintenance | ~₹1,000/year for 25 years | +₹25,000 |
| Total lifetime cost | System cost + maintenance | ~₹90,000–₹1,10,000 |
| Net cost per unit | Total cost ÷ total lifetime units | ~₹2.54–₹3.38 per unit |
This net cost per unit is calculated before accounting for tax savings on the offset consumption over 25 years and any government subsidy received upfront — both of which push the effective cost per unit even lower. For an itemized subsidy breakdown by system size, see the full cost guide.
Frequently asked questions
How much can rooftop solar reduce my electricity bill?
An on-grid system with net metering typically saves 80–90% of your total bill, since it saves nearly all of the variable charge plus applicable taxes and surcharges, though the fixed charge remains payable. Off-grid systems can eliminate the bill entirely but cost more upfront and don't benefit from net metering credits.
What is the net cost per unit of electricity from rooftop solar?
Based on a 25-year system life, typical maintenance costs, and average efficiency degradation, rooftop solar works out to roughly ₹2.54–₹3.38 per unit generated — usually well below grid tariff rates, especially after factoring in tax savings and subsidy.
Why does net metering make solar more valuable over time?
Because generated electricity is offset against your highest-paid slab tariff rather than a flat rate, and grid tariffs tend to rise year over year while your solar generation cost stays fixed, the effective savings from a net-metered system increase the longer you own it.
How many units does a 1 kW solar system generate per day?
A 1 kW system typically generates 4–4.5 units per day on average, translating to roughly 1,460–1,642 units per year before accounting for cloudy or low-sunlight days.
Is rooftop solar worth it if I live in a high electricity tariff slab?
Yes — since net metering offsets consumption at your highest slab tariff, and taxes/surcharges on that consumption are also avoided, households in higher tariff slabs typically see the fastest payback and the largest long-term savings.
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