How does net metering work in India?

Net metering is a billing mechanism that credits solar energy system owners for electricity they add to the grid. It's essentially free energy storage, allowing you to 'bank' excess solar production during the day and use those credits at night.

How Net Metering Works

Your solar system connects to the grid through a bi-directional meter that tracks both energy consumed from and exported to the grid. During sunny hours when your panels produce more than you use, excess power flows to the grid and your meter runs backward, accumulating credits. At night or cloudy periods, you draw from the grid using accumulated credits. Your bill shows net consumption (grid import minus solar export).

Gross vs Net Metering

Gross metering means all solar generation is exported to the grid at a fixed rate, and you buy all consumption at retail rate. Net metering is more beneficial - you only pay for net consumption (consumption minus solar export). Most states now offer net metering for residential and small commercial installations up to certain capacity limits.

State-Wise Net Metering Policies

Each state DISCOM has specific net metering regulations. Common features include: capacity limits (typically 1MW or sanctioned load), 1:1 credit ratio (solar export valued at retail tariff), annual settlement cycles, and technical requirements for equipment. States like Karnataka, Maharashtra, Gujarat have well-established policies. Check your local DISCOM website for specific regulations.

Settlement and Billing Cycles

Net metering typically operates on annual settlement cycles. Excess credits accumulated over the year are either carried forward, paid at wholesale rates (lower than retail), or forfeited depending on state policy. Monthly bills show your net consumption. Design your system to match annual consumption rather than oversizing, as excess generation often isn't fully compensated.

Application and Approval Process

Installing a net-metered solar system requires DISCOM approval. Xrossways submits your application with technical specifications, obtains feasibility approval, coordinates meter installation, arranges net metering agreement execution, and ensures compliance with all regulations. The approval process typically takes 2-4 weeks depending on the state.

Benefits Beyond Energy Savings

Net metering eliminates the need for expensive battery storage for most users. It provides 100% backup during the day when solar is generating. Excess credits can offset fixed charges and other electricity components. For businesses, it reduces peak demand charges by shifting consumption pattern. The grid effectively becomes your infinite capacity battery.

Related Questions