A grid-tied solar system generates energy from the sun and stores it in the utility grid, so you can use it anytime you need it.

If you have access to the utility grid, and your main concern is getting the most value from your investment, grid-tied solar is the way to go. It has the lowest upfront cost because you don’t have to buy batteries to store the power you generate. The grid takes care of storage for you.

During peak hours, you may generate more electricity than you need to power your home. In most states, you can sell this excess power to the utility company, which stretches the value of your investment even further.

The initial costs involved with the installation of solar rooftop systems can be a crucial factor hindering the adoption of solar energy, especially in the residential sector where almost every user across the country gets subsidized electricity. Therefore, to aid the adoption of RTS systems, the government has declared central financial assistance (CFA) of Rs 11,814 crore for phase-II of the programme. Also, during the launch of phase-II, MNRE had proposed an amount of Rs 6,600 crore to be allocated to the residential sector as CFA.

MNRE has laid down the regulations which would be followed for the disbursement of subsidies/CFA in this phase. Now, let’s take a look at how much subsidy can individual residential households avail for the installation of rooftop solar systems as per those regulations.

Individual residential households eligible for availing subsidies/CFA shall be provided financial assistance according to the norms specified by their respective State Electricity Regulatory Commissions (SERCs) and the regulations prescribed in the ‘operational guidelines for the implementation of phase-II of Grid Connected Rooftop Solar Programme’, which are as follows:

·         For RTS plants with capacity up to 3 kW, 40% of the benchmark cost or cost arrived through tender, whichever is lower, can be availed as subsidy


·         For RTS plants with capacity higher than 3 kW but below 10 kW, 20% of the benchmark cost or cost arrived through tender, whichever is lower, can be availed as subsidy 


·         For RTS plants with capacity more than 10 kW, subsidies can be availed for the initial 10 kW as per the regulations mentioned above. However, subsidies cannot be availed for capacity above 10 kW

For FY 2019-20, the benchmark cost of RTS systems with capacity up to 10 kW, as determined by MNRE, is Rs 54 per Wp. Whereas, the cost arrived through tender is Rs 50 per Wp. Therefore, the extent of the subsidy would be calculated as per the cost arrived through tender i.e. the lower estimated cost.