On-Grid Solar in India
The cheapest and most common way to put solar on an Indian rooftop — and the only one eligible for the PM Surya Ghar subsidy. Here's exactly how it works, what it costs, and the one situation where it lets you down.
Best for: Urban and semi-urban homes with reliable grid supply and high electricity bills. If your area has under 2 hours of daily outage, this is almost always the right answer.
What "on-grid" means
An on-grid (grid-tied) system connects your solar panels directly to the utility grid through a bi-directional meter. There are no batteries. When your panels produce more than you consume, the excess flows back to the grid and your meter effectively runs backwards.
How the money works
Under net metering, you're billed only on your net consumption. Generate 400 units in a month, use 300, and you pay for zero while carrying a 100-unit credit forward. Some states pay cash for surplus at a buyback rate (typically ₹2–3.5/kWh); others only offset your bill against future consumption.
Because self-consumed units save you your full retail tariff (₹5–7.5/kWh in most states) while exported units earn only the lower buyback rate, the economics are always best when you use as much of your own generation as possible — run heavy loads during daylight.
What it costs
On-grid systems run roughly ₹55,000–85,000 per kWp installed, before subsidy, depending on panel type, inverter quality, the mounting structure and your city; some budget quotes come in lower. A typical 3 kWp home system costs around ₹1.6–2.4 lakh gross. There's no battery — which is 40–50% of an off-grid system's cost — so this is the most affordable configuration by a wide margin. For a 1–10 kW price list before and after subsidy, see our solar panel cost guide.
₹78,000
max subsidy (up to 3 kW)
Where on-grid wins
- Cheapest per kWp — no battery cost to carry
- Subsidy eligible — the only configuration that qualifies for the PM Surya Ghar subsidy (up to ₹78,000)
- Lowest maintenance — inverter and panels only, no battery to replace every 5–8 years
- Fast payback — typically 3–5 years in high-tariff states like Haryana, Delhi, Maharashtra, and West Bengal
The one catch: power cuts
During a grid outage, an on-grid inverter shuts down automatically — even in bright sunlight. This is a mandatory safety feature called anti-islanding: it stops your system exporting power to the grid while linemen are repairing it, so they aren't electrocuted. The practical result is that a pure on-grid system gives you no backup during a blackout.
If your area has frequent, long outages (4+ hours daily), consider a hybrid system with a small battery, or a full off-grid setup.
Frequently asked questions
Do I need permission from my DISCOM?
Yes. On-grid systems require a net-metering application and approval from your electricity distribution company, plus installation of a bi-directional meter. A good installer files this paperwork for you. Timelines vary from a few weeks to a couple of months by state.
Will solar cover my whole bill?
It depends on how your system size compares to your consumption and how much you use during daylight. Many homes offset 70–100% of their bill. Use our
rooftop solar calculator to size it against your actual load.
What happens to extra units I don't use?
They're exported to the grid. Depending on your state, you either get a cash buyback (₹2–3.5/kWh) or a unit credit adjusted against future bills. Some DISCOMs zero out unused credits at the financial year end, so oversizing far beyond your consumption can waste generation.
Related guides
- Solar panel cost in India (2026) — price per kW, 1–10 kW price list and cost after subsidy
- How many solar panels do I need? — sizing from your monthly units, with tables
- Solar generation per kW — units per day, month and year by state and system size
- Net metering explained — how exported units are credited and the national rules
- Off-grid solar guide — battery sizing and lifespan, and why there is no subsidy
- Hybrid solar guide — grid export plus a small battery for power cuts
- Solar panel types compared — polycrystalline, mono PERC, TOPCon and bifacial
- Earning from surplus space — oversizing on a big terrace, warehouse roof or plot
- Commercial rooftop solar — sizing, cost, depreciation and payback for businesses
- PM Surya Ghar subsidy explained — slabs, eligibility and how to apply
- State electricity tariffs — tariff, buyback rate and payback for 22 states
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ℹ️Figures are indicative estimates based on standard assumptions. Actual cost, generation, and subsidy depend on your site, DISCOM, and vendor. Not financial or engineering advice.