You’ve probably heard that solar saves money on electricity bills. What you might not know is that how much you actually save depends almost entirely on a single decision: which metering system your state offers and which one you pick. This choice determines whether you get ₹80 in monthly savings or just ₹30. It’s the difference between breaking even in 4 years versus 8 years. Yet most businesses don’t understand what they’re choosing until after they’ve signed contracts.
If your solar panels generate 10 units and you use 7, you only get charged for 3. The extra 3 units sit as credits on your bill. You’re essentially using the grid as a free battery.
Gross metering works completely differently. Every unit your solar system generates goes into the grid at a fixed price (let’s say ₹3 per unit). Then you buy back the power you need at full retail price (₹8 per unit). It’s two separate transactions. All generations sold, all consumption purchased.
Here’s the problem: power distribution companies, called DISCOMs in India, were bleeding money. Under net metering, your highest-paying industrial customers started using solar. Their consumption dropped 40-50%. The DISCOM lost that revenue instantly. They couldn’t cross-subsidise power for farms and homes anymore. The entire system started breaking.
So states started shifting toward gross metering for large installations and introducing something called net billing as a compromise.
Net billing sits between net and gross metering. You still use your own solar power first. But when you export surplus to the grid, you don’t get paid at the full retail rate like net metering. You get paid less, maybe ₹3 per unit instead of ₹8. It’s fair-ish to DISCOMs but clearly worse for you.
The problem? Once you’re in a net billing contract, you can’t switch to net metering. Your financial model gets locked in. And net billing only makes sense if you have battery storage to maximise your own consumption. Without it, you’re constantly exporting power at low rates and buying it back at high rates. That’s just bad business.
A solar installation company in India selling you net billing without mentioning battery storage is doing you a disservice. The math only works if storage is part of the plan.
The Ministry of Power simplified the net metering process dramatically. Separate agreements are now integrated into online applications. Karnataka did something more interesting. Starting July 2025, they introduced Virtual Net Metering and Group Net Metering.
If your company operates multiple facilities across the state, solar credits from one site can offset consumption at another. This is massive for corporations. An industrial company with three factories can now treat them as one energy system. Credits flow wherever needed.
Maharashtra took another approach. You can now combine rooftop solar net metering with open access power purchases simultaneously. One building uses net metering solar. Another buys bulk power from a solar farm across state lines. Different tools for different needs. That flexibility matters when you’re trying to optimise across locations.
Let’s use real examples. Say your facility pulls 15 kW of power continuously. You install 10 kW of solar. Here’s what happens:
Under net metering, you generate 10 units daily during sunlight. You use 7 immediately. You export 3 to the grid. Grid price is ₹8/unit. You get ₹24 credit. At night, you pull 8 units from the grid at ₹8, costing ₹64. Daily bill: ₹40. Monthly: ₹1,200.
Under gross metering, you generate 10 units. Grid buys all 10 at ₹3 (feed-in tariff), paying you ₹30. You buy 15 units from the grid at ₹8 = ₹120. Net cost: ₹90 daily, ₹2,700 monthly.
Same solar system. Same consumption. Different metering method. You save ₹1,500 monthly difference. Over 25 years, that’s ₹450,000. When a solar installation company in India is pitching you their system, ask them specifically which metering option applies to your capacity and location.
This is important because policies differ drastically. Gujarat offers net metering up to 1 MW capacity. Rajasthan does the same. Karnataka started allowing virtual and group net metering just recently. Tamil Nadu? They shifted commercial installations to gross metering.
A facility in Gujarat gets different rules than one in Tamil Nadu, even if they’re identical operations. A solar installation company in India operating across states knows these differences. One that operates in just one state might not.
Settlement rates also vary. Maharashtra pays ₹2.90 per unit under most systems. Gujarat pays ₹2.25 for the first five years. Karnataka offers ₹3.82 for residential, ₹2.84 for larger systems. That’s 70% higher in Karnataka than in Maharashtra. Over a 25-year PPA, those fractions add up.
Net billing is becoming standard for new installations. This has one major implication: battery storage becomes essential for financial viability. Without storage, you’re exporting power at ₹3/unit while buying at ₹8/unit. That’s a terrible arbitrage.
Battery costs have been dropping 5-7% annually. A 10 kWh battery that cost ₹8 lakhs in 2022 now runs ₹5 lakhs. Payback is hitting 8-12 years, which is acceptable over a 25-year solar asset life.
But here’s what most businesses don’t realise: choosing between net metering and gross metering or net billing isn’t just a technical decision. It’s a financial decision you make once and live with forever. You cannot switch systems mid-contract. The regulations are explicit about this.
Don’t dismiss gross metering. If your business is a developer that’s primarily interested in generating power for sale (not self-consumption), gross metering offers predictable revenue. A fixed feed-in tariff means stable cash flows. You’re not dependent on your own consumption patterns. Energy sellers prefer this. Energy consumers should avoid it.
Call a solar installation company in India and ask three specific questions:
First: What metering option applies to my capacity and state? If they don’t give you a specific answer with a state regulatory reference, they don’t know their job.
Second: What’s the total compensation rate under each system for my location and capacity? Not the headline rate. The actual landed cost after all surcharges.
Get quotes from companies with proven projects in your specific state. References from companies in your industry. Not theoretical proposals. Real, operating installations with actual financial data.
Net metering is moving toward extinction in India. Gross metering is becoming common. Net billing is the new standard. Battery storage is no longer optional—it’s becoming mandatory for financial viability.
The PM Surya Ghar scheme simplified processes to drive adoption. But these simplifications only matter if you’re choosing the right metering system for your situation. A solar installation company in India that doesn’t explain this is setting you up for disappointment.
The policy changes in 2025 aren’t just bureaucratic tweaks. They fundamentally restructured how much money you’ll save by going solar. Understanding these changes before you sign anything is the difference between a great investment and an expensive mistake.
Neutron Solar is not just an EPC vendor; it is a strategic renewable energy partner that aligns solar assets with long-term business goals. From feasibility and land acquisition to policy navigation and operations, everything sits under one expert roof. The result is faster project turnaround, optimised performance ratios, and clean power that improves both sustainability metrics and operating costs.