Net Metering vs Net Billing: What Changed for C&I Solar
By Hardik BhatiaPublishedFor years, the financial case for industrial rooftop solar in India rested on a simple assumption: every unit you export to the grid offsets a unit you import, at your full retail tariff. In 2026, that assumption is breaking down for larger consumers - and if your savings model still relies on it, your numbers may be out of date.
Net metering credits your exported solar units against imported units at the full retail tariff. Net billing pays a lower, separate rate for exports while you buy imports at retail - reducing the value of surplus generation. Several Indian states have revised how larger rooftop systems are compensated, with many moving away from full retail-rate net metering toward lower export compensation, and some now levying grid support charges on solar generation. This makes self-consumption, not export, the foundation of C&I solar economics.
Here's what CFOs, plant heads, and sourcing teams need to understand before they size a system or sign a contract.
What is the difference between net metering and net billing?
The difference is what your exported solar power is worth. Under net metering, the units you send to the grid are credited at the same retail tariff you pay for the units you draw - so a unit exported and a unit imported cancel out. Under net billing, your exports are valued at a separate, usually lower rate (often close to the utility's average power purchase cost), while your imports are still charged at full retail tariff.
For a high-tariff industrial consumer, that gap is large. In Maharashtra, for example, HT industrial tariffs often fall between ₹8 and ₹10 per unit in high-tariff industrial categories (varying by voltage level, time-of-day period, and consumer class), while surplus exported under the open-access/net-billing framework for larger systems is typically compensated near the utility's average power purchase cost (APPC) — recently in the ₹3–4 per unit range. The takeaway is structural, not state-specific: under net billing, exporting surplus solar is worth far less than consuming it on site.
A third model, gross metering, sits at the far end: all generation is sold to the grid at a fixed feed-in tariff and you buy all your power separately. It is generally used where a consumer wants predictable export revenue rather than bill offset - less common for self-consumption-focused industrial rooftops.
What are grid support charges, and who pays them?
Grid support charges (GSC) are a per-unit fee levied on solar generation from larger systems, meant to recover the cost of using the grid as backup. The logic from distribution utilities is that a solar consumer still relies on the grid at night and during low-generation periods, and that this "balancing" has a cost.
Maharashtra is the clearest example. Under MERC's Multi-Year Tariff Order (Order 75 of 2025), grid support charges were triggered when the state's rooftop capacity crossed 5,000 MW in early 2026. Systems with sanctioned load or solar capacity above 10 kW — which is effectively all C&I installations - now attract the charge, approved at ₹1.40 per unit in FY2025–26 and rising across the control period to ₹1.77 per unit by FY2029–30. Systems of 10 kW and below remain exempt.
Two points matter for buyers. First, this is a per-unit charge on generation, so it directly erodes the per-kWh savings your project was sized to deliver. Second, Maharashtra is among the first large states to implement grid support charges under a defined regulatory framework, but many states are revisiting rooftop compensation mechanisms as distributed solar penetration increases - so C&I buyers everywhere should treat this as a risk to model, not a Maharashtra-only quirk.
How do these changes affect industrial solar savings?
They shift the entire economic case from "export and bank" to "generate and self-consume." When exports were credited at full retail tariff and surplus could be banked against night consumption, oversizing a system and leaning on the grid as a free battery made financial sense. Under net billing, grid support charges, and tighter banking rules, that strategy loses much of its value.
The practical consequences for a C&I project:
Right-sizing beats oversizing. A system tuned to match daytime load — so that most generation is consumed on site rather than exported — now delivers materially better returns than a larger system that exports heavily.
Load profile drives the design. A single-shift daytime manufacturer, a 24×7 cold storage, and a warehouse with modest daytime draw now have very different optimal system sizes and configurations.
Storage enters the conversation. Where evening or night consumption is significant and banking provisions have tightened in your state, pairing solar with battery storage can capture value that would otherwise be lost to low export rates — though this is a project-specific calculation, not a universal answer.
Every pre-2026 savings model needs re-checking. If your feasibility study assumed full-tariff export credit or banking that no longer applies in your state, the projected IRR is likely overstated.
Does this mean industrial solar is no longer worth it?
No — but the source of the savings has moved. The core economics remain compelling: self-consumed solar still displaces power that a factory would otherwise buy at ₹8–10 per unit in high-tariff states, and rising grid tariffs continue to widen that gap over a 15–25 year asset life. What has changed is that the savings now come almost entirely from avoided consumption, not export revenue — which rewards accurate load analysis and disciplined system design over simply maximising installed capacity.
This is also where the ownership model matters. Under a CAPEX project, you own the design decisions and the regulatory risk of getting the sizing wrong. Under an OPEX/RESCO structure, a developer who understands your load profile and the local billing regime designs the system to maximise self-consumption, and you simply pay a per-unit tariff for the solar power you actually use — insulating you from export-rate and banking changes by design.
What should C&I buyers do before installing solar in 2026?
Treat the local billing regime as a core input to system design, not an afterthought. Five questions worth answering before you commit:
What billing mechanism applies to my consumer category and system size in my state — net metering, net billing, or open access?
Do grid support charges apply, and at what per-unit rate today and over the next few years?
What share of my generation will I actually self-consume versus export? This single number drives the whole economic case.
How do banking and settlement rules in my state treat surplus?
Has my proposal been modelled on current rules, or on the pre-2026 full-export-credit assumption?
A developer who can answer these for your specific site and state — with current tariff orders in hand — is doing the analysis that actually protects your returns. The same diligence applies to module compliance: see our explainer on what ALMM List-II means for C&I rooftop buyers for the procurement side of the picture.
The bottom line for industrial buyers
The shift from net metering toward net billing, combined with grid support charges on larger systems, doesn't weaken the case for industrial solar — it changes what a good project looks like. The winners in 2026 are consumers whose systems are sized to their load and designed for self-consumption; the projects at risk are those still modelled on the old export-and-bank logic. Getting the design right, for your state's rules and your facility's load, is now the difference between a strong return and a disappointing one.
SustVest designs rooftop solar around your actual load profile and your state's current billing rules — across OPEX and CAPEX models, with battery storage where the economics support it. As a CRISIL Top-10 Rooftop Solar Developer, we model your project on today's regulations, not yesterday's assumptions. Book a free site assessment to see what your savings look like under current rules.
Frequently Asked Questions
What is the difference between net metering and net billing in India? Under net metering, exported solar units are credited at the full retail tariff, so exports and imports offset one-for-one. Under net billing, exports are paid at a lower separate rate while imports are charged at retail tariff, reducing the value of surplus generation. Net billing makes self-consumption more valuable than export.
What are grid support charges on solar? Grid support charges are per-unit fees levied by distribution utilities on solar generation from larger systems, intended to recover the cost of providing grid backup. In Maharashtra, under MERC Order 75 of 2025, they apply to systems above 10 kW after the state crossed 5,000 MW of rooftop capacity in early 2026, starting at ₹1.40 per unit and rising to ₹1.77 per unit by FY2029–30.
Do grid support charges apply to all rooftop solar? No. In Maharashtra they apply to consumers with sanctioned load or solar capacity above 10 kW, which covers most commercial and industrial installations, while systems of 10 kW and below are exempt. Rules and thresholds vary by state and should be checked for each project.
How do net billing and grid support charges affect industrial solar savings? They shift the economic case from exporting surplus to self-consuming generation. Savings increasingly come from displacing high-tariff grid power consumed on site rather than from export credits, which rewards accurate load-based system sizing over oversizing.
Is industrial rooftop solar still worth it under net billing? Yes, in most high-tariff industrial settings. Self-consumed solar still displaces grid power that often costs between ₹8 and ₹10 per unit in high-tariff industrial categories, and rising tariffs widen that gap over the system's life. The key is designing for self-consumption rather than relying on export revenue.
Can battery storage help under the new billing rules? It can, where a facility has significant evening or night consumption and banking is restricted. Storing daytime solar for later use can capture value that low export rates would otherwise forfeit, though whether it pays off is a project-specific calculation.
Sources
MERC Multi-Year Tariff Order 75 of 2025 (5th Control Period, FY 2025–26 to FY 2029–30) — Maharashtra Electricity Regulatory Commission
MERC Grid Interactive Rooftop Renewable Energy Generating Systems Regulations (2023, as amended) — for the underlying net-metering/net-billing framework
MSEDCL clarifications on Grid Support Charge applicability and thresholds (2026)
HT industrial tariff and APPC export-rate ranges: MERC tariff schedules / industry reporting (2026)