Solar is one of the few home and business investments that pays you back every single month. Here is how to estimate the return on your system.
Step 1: Estimate generation
In most of India, 1 kW of solar generates about 3.8–5 units (kWh) per day, or roughly 1,300–1,600 units a year, depending on location, tilt and shading.
Step 2: Multiply by your tariff
Every unit you generate is a unit you don't buy. At ₹8/unit, a 5 kW system generating ~600 units a month saves around ₹4,800 a month — about ₹57,600 a year.
Step 3: Divide the net cost by annual savings
If the 5 kW system costs ₹3,00,000 and you receive ₹78,000 subsidy, your net cost is ₹2,22,000. Payback ≈ 2,22,000 ÷ 57,600 ≈ 3.9 years.
Step 4: Look at 25 years, not one
- Panels degrade only about 0.5% a year
- Grid tariffs have historically risen 3–5% a year
- Over 25 years, the same system can save well over ₹20 lakh
Commercial & industrial users
Businesses pay higher tariffs and can claim accelerated depreciation, which often brings payback down to 3–4 years and pushes ROI above 25% a year.
Try our solar calculator for a personalised estimate based on your state and bill.
