Solar Net Metering in India: Works and Benefits 2025

Most industries and commercial establishments look to reduce energy costs through net metering in India and support a sustainable future. Sun Photonics helps other businesses to use energy as per their energy needs because we provide solar energy installation Rooftop Solar and Ground-Mounted Solar services in commercial and industrial areas.

Here, we will explore what solar net metering is, how it works, its advantages and disadvantages in India, and dose it worth using net metering in the current timeline.

What is Net Metering in Solar?

“Net metering is a billing mechanism that allows solar energy users to feed surplus electricity back into the grid.”

In simple terms, when your solar panels generate more power than you need, the extra energy is sent to the local power grid, and you receive credits against your electricity consumption. This system helps balance energy use, making it an attractive option for both homeowners and business personalities.

For businesses, net metering means that energy produced during peak sunlight hours can help offset power drawn from the grid during periods of low production, such as at night or on cloudy days. This method helps to reduce electricity bills and also the good power supply across the grid.

How Net Metering Works

The process of net metering is straightforward and designed to make solar power more accessible and efficient:

Generation of Solar Power: Solar panels installed on your building or facility capture sunlight and convert it into electricity. During the day, when sunlight is abundant, your system may generate more energy than is immediately required.
Feeding Excess Energy: The surplus energy is automatically fed back into the grid. Instead of going to waste, this excess power earns you credits on your utility bill.
Drawing Energy When Needed: At night or during periods when the solar panels do not produce enough electricity, you draw power from the grid. The credits accumulated from the excess production help reduce the amount you pay for this consumed power.
Monthly Reconciliation: At the end of each billing cycle, the utility company calculates your net energy consumption. If your solar installation has produced more energy than you used, you might even receive a payment or additional credit, depending on local regulations.

This system continuously makes and uses energy, helping businesses save money and easing the strain on the power grid.

Advantages and Disadvantages of Net Metering in India

As India advances towards 2025, net metering is emerging as a crucial component in the country’s renewable energy strategy. However, like any system, it comes with its benefits and challenges.

Advantages

Reduced Electricity Bills: One of the most significant benefits of net metering is the reduction in monthly electricity costs. By offsetting grid consumption with solar-generated energy, businesses can see a noticeable drop in their utility bills.
Sustainable Energy Use: By adopting net metering, companies contribute to a greener environment. Using Solar energy reduces reliance on fossil fuels and lowers greenhouse gas emissions.
Energy Independence: Businesses that install solar panels can become less dependent on the grid, gaining a measure of energy independence. This method of electricity can give you independence from grid power.
Financial Incentives: Net metering can make the transition to solar energy more attractive by improving the return on your solar power investment. Even if you have to spend money at the start, the money you save later and the extra income from surplus energy make it a smart choice.
Support for Clean Energy Policy: As government policies continue to evolve in Favor of renewable energy, net metering schemes are likely to benefit from additional incentives and regulatory support. For example, factors such as improvements in incentive schemes—even influences like China’s Export Tax Rebate—can have ripple effects on global solar pricing and policy frameworks, indirectly benefiting India’s solar industry.

Disadvantages

Initial Investment: While net metering offers long-term savings, the initial installation cost for solar panels and related equipment can be high. However, many businesses find that the savings over time justify the upfront expense.
Regulatory Hurdles: The success of net metering depends on supportive government policies and regulations. In some areas, if the rules for energy pricing or how the grid is managed change, it could affect the overall benefits.
Grid Management Issues: Integrating a large amount of distributed solar power into the grid can present technical challenges. Grid operators must carefully match the amount of electricity available with what people are using, which might mean improving the current system.
Variability in Energy Production: Solar energy generation is inherently variable. Weather conditions and seasonal changes can affect the amount of solar electricity generation to prevent businesses from having backup plans or energy storage solutions in their places.

About the Author

Jatin Singh is a content developer at Sun Photonics Pvt. Ltd., specializing in creating impactful content for solar energy solutions. With a background in tech and health, he has previously worked in digital marketing and pharma. Passionate about sustainability, and currently exploring all things about solar!

Ground-Mounted Solar – Benefits,

January 27, 2025 0 Comments

As India marches toward its renewable energy goals, ground-mounted solar power plants are emerging as

RIPV (Rooftop Solar System)

January 13, 2025 0 Comments

As the shift to sustainable energy grows, businesses are looking at renewable options to power

Why Solar Power is

December 6, 2024 0 Comments

In today’s business landscape, the transition to solar energy is no longer a luxury—it’s a

Why Solar Power Makes

December 5, 2024 0 Comments

In today’s competitive market, businesses are constantly seeking ways to cut the costs and increase

FAQ

What is net metering in India?

Net metering is a billing system that allows solar energy users to send excess electricity to the grid and receive credits. At the end of the billing cycle, consumers are charged only for the net energy consumed (imported minus exported units).

🔹 Key Benefit: Reduces electricity bills by utilizing solar power efficiently.

How does net metering work in India?

Net metering operates through a bi-directional meter that tracks:
✔ Imported electricity (from the grid)
✔ Exported electricity (surplus solar power sent to the grid)

The difference between the two is what you are billed for. Any excess credits roll over to the next billing cycle as per your state’s net metering policy.

Can I sell surplus solar power to the grid?

Yes! Under the net metering policy, any excess solar power generated by your system is exported to the grid. In return, you receive credits on your electricity bill, reducing your overall energy costs.

📌 Tip: Compensation rates vary by state DISCOM policies. Check with your local electricity board.

Will my solar panels work during a power outage?

No, a grid-tied solar system automatically shuts down during a power outage to protect utility workers repairing the grid.

⚡ Solution: If you need backup power, consider adding a solar battery storage system for uninterrupted electricity.

What type of meter is required for net metering?

A bi-directional net meter is required. It measures both:
🔹 Electricity consumed from the grid
🔹 Electricity exported to the grid

This ensures accurate billing under the net metering arrangement. The installation process is handled by your local electricity provider (DISCOM).