Shops, offices & SMEs · India
PM Surya Ghar does not cover a commercial connection — but that rarely makes the case worse. Higher tariffs and a load that peaks in daylight mean businesses often reach payback sooner than homes do, provided the export rules are understood first.
The structural differences
| Residential | Commercial | |
|---|---|---|
| Central capital subsidy | Yes, up to 3 kW ceiling | No |
| Main tax benefit | None | Accelerated depreciation |
| Tariff per unit | Lower, slab-based | Usually higher |
| Load timing vs solar | Often evening-heavy | Usually daytime — a good match |
| Export compensation | Net metering common | Often net or gross billing |
| Capacity cap | Roof and subsidy driven | Often tied to sanctioned load |
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Before anything else, look at the tariff category printed on your electricity bill. Central assistance under PM Surya Ghar is aimed at residential consumers; a commercial or industrial connection is outside it. What decides this is the category on the connection, not how you personally describe the premises.
That distinction matters most in mixed-use buildings — a shop below, a home above. If the shop draws from a separate commercial connection, that connection cannot claim the residential route even though the building is partly a residence. Conversely, where a genuinely domestic connection serves the premises, the residential path and its eligibility rules apply to it.
Accelerated depreciation is the principal benefit available to a business. It permits the cost of a solar asset to be written down faster than ordinary assets, reducing taxable profit in the early years and so improving effective returns. The rate and the conditions attached to it are matters of income tax rules that change periodically, which is why the specific number belongs with your accountant rather than in a vendor's presentation. Treat any vendor who quotes a confident tax outcome without asking about your entity structure with caution.
Beyond that, input tax credit treatment can be relevant depending on registration and how the electricity is used, and some states run their own incentives for commercial consumers separate from anything central. Where such a state layer exists it works like the residential one described in state top-up subsidies — worth checking, never assumed.
Two effects tend to outweigh the lost capital subsidy.
The tariff you displace is higher. Commercial tariffs generally sit above domestic ones per unit, so each generated unit saves more money. The savings arithmetic explained in costs and payback works in your favour at a higher tariff.
Your load matches the sun. This is the real structural advantage. A shop, clinic, office or small workshop consumes most heavily between mid-morning and evening, which is precisely when a rooftop array produces. That means a high share of generation is self-consumed at full tariff value rather than exported for a credit worth less.
Homes frequently have the opposite problem: a consumption peak after sunset, which is why the mismatch discussed in solar panels for an AC is such a recurring theme in residential advice. Commercial premises mostly do not have that problem.
Fixed and demand charges do not fall. A commercial bill separates energy charges from fixed or demand charges based on sanctioned load or maximum recorded demand. Solar reduces the first. It does not normally reduce the second, because the grid must still be capable of meeting your full demand at night. Build any projection on the energy-charge portion of the bill, and be sceptical of one built on the bill total.
Export may not be compensated at your tariff. Several states limit conventional net metering for non-residential consumers or above a threshold capacity, applying net billing or gross metering instead, where exported units earn less than you pay. The design consequence is direct: where export pays poorly, the correct plant is sized close to your daytime consumption rather than to maximise generation. Establish the applicable arrangement with your DISCOM — the mechanics are in net metering in India, and state practice varies as the TGSPDCL and APSPDCL pages illustrate.
Under CAPEX the business buys the system, owns it, maintains it, and keeps the entire benefit including depreciation. Highest return, and it requires capital and a willingness to own an asset on the roof.
Under OPEX, sometimes called a RESCO arrangement, a developer funds and owns the plant on your roof and sells you the electricity at an agreed rate under a long-term agreement, usually with no upfront outlay. That solves the capital problem and shifts operational responsibility — but it commits your roof and your electricity purchase for many years. Read the tariff escalation clause, the term, the performance obligations and the exit and transfer terms with the same care you would give a lease, because that is effectively what it is.
For a small shop the capital sums are usually modest enough that CAPEX is straightforward. OPEX becomes more compelling as system size grows.
Roof area is often not the binding limit. Two others usually bite first: a regulatory cap tying rooftop capacity to a proportion of sanctioned load or contracted demand, and the economic logic above that discourages sizing beyond daytime consumption where export pays poorly. Settle both questions, then check the roof against the resulting number using roof area needed — and note that systems at this scale commonly require a three-phase connection, as 10 kW price discusses.
To be straightforward about it: our free check is built for homes on domestic connections, and that is where our advice is most useful. If you run a shop or small premises on a domestic connection, use it normally. If yours is a commercial connection, this page is the honest map of how your case differs — and the vetting discipline in choosing an installer applies to you at least as strongly, because commercial projects carry more scope for a vague contract to become expensive.
No. The central assistance under PM Surya Ghar is directed at residential consumers, and a commercial or industrial connection does not qualify for it. This surprises many shop owners, so it is worth checking the tariff category printed on your electricity bill early rather than late. If your premises is genuinely mixed use and the connection is a domestic one, the residential route may still apply to that connection, but the category on the bill governs the outcome rather than how the space is used in practice.
The main one is accelerated depreciation, which lets a business write down the cost of a solar asset faster than ordinary assets and so reduces taxable profit in the early years. The applicable rate and conditions are set by income tax rules and change from time to time, so the figure should be confirmed with your accountant rather than taken from a vendor slide. Depending on how the business is registered and how the electricity is used, input tax credit treatment may also matter. Some states additionally run their own incentives for commercial consumers.
Often faster, despite the absence of the residential subsidy, for two structural reasons. Commercial tariffs are typically higher per unit than domestic ones, so every unit generated displaces a more expensive unit. And most shops and offices consume electricity during exactly the hours solar produces it, which means a high share is self-consumed at full tariff value rather than exported for a credit. Those two effects frequently outweigh losing the capital subsidy, particularly for premises with a strong daytime load.
Generally not, and this is a common source of disappointment. A commercial bill usually separates energy charges, which are based on units consumed, from fixed or demand charges based on sanctioned load or maximum recorded demand. Rooftop solar reduces the energy charges. It does not normally reduce the fixed or demand component, because the grid connection must still be able to supply your full demand when the sun is not shining. Any savings estimate should therefore be built on the energy-charge portion of your bill, not the total.
It depends on the state and often on the capacity involved. Several states restrict conventional net metering for non-residential consumers or beyond a threshold capacity, applying net billing or gross metering instead, under which exported units are compensated at a rate lower than the tariff you pay. The practical consequence is significant: where export is poorly compensated, the right design is one sized close to your daytime consumption rather than one that maximises generation. Confirm the applicable arrangement with your DISCOM before finalising capacity.
Under a CAPEX model the business buys and owns the plant, carries the maintenance responsibility, and keeps the whole benefit including depreciation. Under an OPEX or RESCO model a developer funds and owns the plant on your roof and you buy the electricity it produces at an agreed rate under a long-term agreement, typically with no upfront capital outlay. OPEX suits businesses unwilling to deploy capital or take on operational responsibility, but it commits the roof and the offtake for many years, so the tariff escalation clause, the term and the exit terms deserve close reading.
Two limits usually bind before roof area does. The first is regulatory: many states cap rooftop capacity at a proportion of the sanctioned load or contracted demand of the connection, so a modest sanctioned load restricts the plant regardless of available roof. The second is economic: sizing beyond your daytime consumption only makes sense where exported units are compensated well, which as noted is not universal for commercial consumers. Establish the sanctioned load position and the export arrangement first, then check whether the roof can hold the resulting capacity.
