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Net Metering in India Explained, State by State

How net metering works for rooftop solar in India: import, export, banking, settlement and surplus rates, with a 2026 table of state differences.

Short answer: net metering lets your rooftop solar push surplus units into the grid and pull them back later. A bi-directional meter counts both directions and you pay only for the net units. Surplus left at the end of the settlement period (monthly, per billing cycle or yearly, depending on the state) is paid or credited at a low fixed rate, roughly ₹2–3.90 per unit in 2026. So the best system size is the one that matches your yearly use (check current notification for your state).

How net metering works, in one picture

Think of the grid as a bank for units:

  1. Daytime: panels make more than the house uses. The surplus flows out through the meter (export).
  2. Evening and night: the house draws from the grid (import).
  3. Bill: import − export = net units billed. If export is higher, the extra units are banked and carried forward.
  4. Settlement: at the end of the period, leftover banked units are paid or credited at the state's surplus rate.

The DISCOM replaces your old meter with a tested and sealed bi-directional (net) meter. Some states also ask for a separate generation meter on the solar output.

Net metering vs net billing vs gross metering

Mechanism How exports are valued Who uses it
Net metering Unit for unit against imports; surplus at a fixed rate Most residential consumers
Net billing / net feed-in Imports at your tariff, exports at a fixed export rate (in ₹) Option in some states (e.g. Rajasthan)
Gross metering All generation sold to the DISCOM at a fixed rate; you buy all your use Some commercial categories, RESCO models
Group / virtual net metering One plant's output shared across several meters Housing societies, multi-site owners, where allowed

The central Electricity (Rights of Consumers) Rules set the framework; each State Electricity Regulatory Commission writes the details. That is why the rules differ so much between states.

State differences in 2026

State Settlement Surplus rate (₹/unit) Points to note
Maharashtra Annual (FY), monthly carry-forward 2.82 Grid support charge on gross generation above 10 kW
Gujarat Each billing cycle 2.25 Draft DRES regulations 2026 pending
Rajasthan Billing cycle, carry-forward 3.26 net metering / 3.65 net billing Domestic consumer chooses
Karnataka Monthly, paid at PPA tariff 3.89 without subsidy; 1.96–2.58 with PM Surya Ghar subsidy Domestic 1–10 kW category
Telangana Monthly, excess paid Lowest discovered solar tariff of previous FY 2025 regulations; slabs based on net use
Andhra Pradesh Monthly since Feb 2026, paid by bank transfer Ask DISCOM Limit 500 kWp
Tamil Nadu Billing cycle, carry-forward Not confirmed Network charge on generation (litigation ongoing)
Kerala Monthly banking, FY settlement 2.79 new / 3.08 existing Storage needed above 10 kW; banking charge
Uttar Pradesh Annual, monthly carry-forward 2.00 (2019 regulations) Net metering for domestic; commercial on gross metering
Madhya Pradesh Annual (Oct–Sep) about 2.14 (APPC), bill credit only Up to sanctioned load, max 500 kW

Sunlectric tariff notes, October 2026. Net-metering data is weaker than tariff data in almost every state, so check the current notification and ask the DISCOM before you quote a payback.

Each state guide goes deeper: Maharashtra, Gujarat, Karnataka, Tamil Nadu, Telangana and AP, Uttar Pradesh, Rajasthan, Madhya Pradesh, Kerala.

Why the settlement period matters

  • Annual settlement (Maharashtra, UP, MP) lets summer surplus cover monsoon shortfall. That is ideal for homes.
  • Monthly settlement (Karnataka, Telangana, AP) pays out each month's surplus at the low rate. Summer surplus cannot cover July. Size a little more conservatively.
  • Billing-cycle settlement (Gujarat) works like monthly, and surplus is paid each cycle.

A worked example

A Pune home on net metering uses 300 units a month (3,600 a year) and has 3 kW of solar making about 4,500 units a year.

  • Imports over the year: depends on timing, but the net is 3,600 − 4,500 = 900 units surplus.
  • Those 900 units are paid at about ₹2.82 = ₹2,538 at year-end (check current notification).
  • The same 900 units cost about ₹55,000–60,000 of panels to produce.

If the home had installed 2.5 kW instead, it would have saved almost as much on the bill for less money. That is the core rule: size to consumption.

Time-of-day (ToD) tariffs and banking

The Electricity (Rights of Consumers) Amendment Rules, 2023 introduced ToD tariffs, with solar-hour rates lower and peak-hour rates higher than normal, phased in for commercial and industrial consumers first and then others with smart meters. For non-residential consumers, several states now bank solar units slot by slot: a daytime export offsets only daytime imports. Maharashtra still lets residential consumers use banked units at any hour. Check your state's order. See do I need a solar battery.

What net metering costs

Many states have waived application and net-metering fees for PM Surya Ghar applicants. Otherwise expect a registration fee, meter testing charges and the meter cost (often supplied or tested by the DISCOM and recovered from you).

Common net-metering questions from homeowners

  • Can I install more than my sanctioned load? Usually not; apply for load enhancement.
  • Will my fixed charge go? No. Fixed charges and meter rent stay.
  • Does solar work in a power cut? Not with an on-grid inverter. See on-grid vs hybrid vs off-grid.
  • How do I read the new bill? See how to read your electricity bill.

Talk to Sunlectric

Want to know how your DISCOM settles surplus before you size the system? WhatsApp +91 89567 89307 (wa.me/918956789307). Our Solar Desk keeps state notes updated, and installers can model each state's rules in Sunlectric Studio or learn them in the Academy policy module.

Sources

Questions people ask

What is net metering?

A bi-directional meter records units you import from the grid and units your solar exports. You are billed only for the net difference. Surplus exports are carried forward and settled at a fixed rate at the end of the settlement period.

Do I get paid for extra units?

Usually yes, but at a low rate: in 2026 roughly ₹2 to ₹3.90 per unit depending on the state, and sometimes only as a bill credit. That is why systems should be sized to your yearly use, not more.

What is the difference between net metering and net billing?

Net metering offsets units against units. Net billing values imports at your tariff and exports at a fixed export rate in money terms. Under net billing each exported unit is worth only the export rate.

Does net metering work during a power cut?

No. On-grid inverters switch off when the grid fails, to protect line workers. You need a hybrid inverter with a battery for backup.

Is there a limit on system size under net metering?

Most states allow up to your sanctioned load or contract demand, with an upper limit that varies (for example 500 kW to 2 MW). Check your state's regulation.

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