Net metering is the policy mechanism that makes grid-connected rooftop solar financially compelling. Without it, any excess solar electricity your panels produce would simply be wasted. With net metering, that surplus flows back to the grid and credits your electricity bill. Yet despite being a cornerstone of India's solar policy, net metering remains poorly understood by most consumers. This guide explains everything clearly.
What Is Net Metering?
Net metering is a billing arrangement between a solar consumer and their electricity distribution company (DISCOM). A special bidirectional electricity meter records two sets of data simultaneously:
- Import units: Electricity drawn from the grid when solar production is insufficient (night, overcast days, high-demand periods)
- Export units: Surplus solar electricity fed into the grid when production exceeds consumption
At the end of the billing cycle, the DISCOM calculates your bill on the net difference. If you imported 300 units and exported 120 units, you pay only for 180 net units. If exports exceed imports in a given period, the credit rolls forward to the next billing cycle.
How the Bidirectional Net Meter Works
Your existing single-direction electricity meter only measures the electricity you draw from the grid. Once you install solar and apply for net metering, the DISCOM replaces it with a bidirectional (two-register) smart meter. This meter has two separate registers — one for import, one for export — and automatically tracks both flows in real time.
In many states, the meter data is now transmitted digitally to the DISCOM's systems, eliminating the need for a meter reader to physically record export figures. This digital integration also enables near real-time monitoring of your consumption and generation patterns through the DISCOM's consumer portal.
"Think of net metering as using the grid as a giant, free battery. You deposit solar units during the day and withdraw them at night — and the grid holds your balance."
The Net Metering Process: Step by Step
Apply Online via DISCOM Portal or PM Surya Ghar Portal
In Rajasthan, applications go through JVVNL's online portal or via the national PM Surya Ghar portal (pmsuryaghar.gov.in). Documents required: electricity bill, property proof, Aadhaar, PAN, and a site layout diagram.
Technical Feasibility Check by DISCOM
The DISCOM's technical team verifies that the local feeder/transformer has capacity to absorb your system's output. In most urban areas, this is a formality. In rural areas, transformer capacity can sometimes be a constraint.
Receive Technical Sanction & Install System
Once sanctioned, your installer proceeds with physical installation. The system must be installed by an MNRE-empanelled installer and conform to approved specifications (panel wattage, inverter model, etc.).
Inspection and Net Meter Installation
A DISCOM engineer inspects the installation for safety and compliance. Upon approval, the existing meter is replaced with the bidirectional net meter — typically within 30 days of commissioning in Rajasthan.
Start Generating Credits on Your Bill
From the first billing cycle after net meter installation, your bill reflects net units consumed. Surplus credits carry forward. Most DISCOMs issue a separate solar generation certificate each quarter.
State-Wise Net Metering Policies (2025)
Net metering policy is governed at the state level, and there are meaningful differences across states. Here is a snapshot of key policies:
| State | Residential Size Limit | Export Tariff | Credit Carry-Forward | Annual Settlement |
|---|---|---|---|---|
| Rajasthan | Up to sanctioned load | ~₹2.50–₹3.00/unit (APP) | Indefinite rollover | Cash payment for net surplus |
| Maharashtra | Up to 1 MW | Average Pooled Purchase Cost (APPC) | Quarterly | Annual financial settlement |
| Gujarat | Up to 1 MW | ₹2.25/unit (residential) | Monthly | Annual cash payment |
| Karnataka | Up to 10 kW residential | APPC (~₹3.50/unit) | Monthly | Annual settlement |
| Tamil Nadu | Up to sanctioned load | ₹2.00–₹2.50/unit | Monthly | Annual payment or waiver |
| Uttar Pradesh | Up to 1 MW | APPC | Monthly | Annual settlement |
| Delhi | Up to 5 MW | ₹3.00/unit | Monthly | Annual cash payment |
The key distinction across states is the export tariff — the rate at which the DISCOM compensates you for exported units. This is almost always lower than the retail import tariff. The gap creates the "self-consumption premium" — it is always more valuable to use your solar power directly than to export it.
Understanding Your Net Metering Bill
A net metering bill has additional line items compared to a standard electricity bill. Here is how to read it:
- Import Reading: Total units drawn from the grid this billing period
- Export Reading: Total units sent to the grid this billing period
- Net Units: Import minus Export (if positive, you owe; if negative, you have surplus credits)
- Energy Charges: Calculated on Net Units at your applicable tariff slab
- Fixed/Demand Charges: These are NOT waived under net metering — you still pay the fixed monthly charge regardless of solar generation
- Carryforward Credits: Any previous period surplus rolled into this bill
Common Myths About Net Metering — Debunked
"My electricity bill will become zero every month with net metering."
Fixed charges, wheeling charges, and demand charges are not waived under net metering. In most states, these fixed costs amount to ₹100–₹300/month regardless of solar generation. Your energy charges can go to zero, but the fixed component remains.
"I get paid the full retail rate for every unit I export."
Export tariffs are typically 30–60% of the retail import tariff. In Rajasthan, the export rate is approximately ₹2.50–₹3.00/unit while you pay ₹6–₹7/unit for imports. This is why maximising self-consumption (not exporting) delivers the best financial return.
"DISCOMs can refuse net metering applications."
Under CERC (Central Electricity Regulatory Commission) regulations and state-level orders, DISCOMs are legally obligated to provide net metering to eligible applicants. They can only decline if there is a genuine technical constraint on the local feeder — and even then, they must provide a written technical report.
"Net metering means I'm selling electricity commercially and need a license."
Net metering is specifically classified as a consumption offset arrangement, not commercial electricity trading. Residential and commercial rooftop solar consumers with net metering do not require an electricity trading license. The arrangement is purely between you and your DISCOM.
"Net metering will be discontinued in a few years."
The Government of India's Electricity (Promoting Renewable Energy Through Green Energy Open Access) Rules, 2022 and the Ministry of New and Renewable Energy's guidelines mandate net metering for systems up to 500 kW. The policy framework is stable and supported at both central and state levels.
Net Billing vs. Net Metering: Know the Difference
Some states are transitioning from net metering to "net billing" or "gross metering" for new installations. Under gross metering, all solar generation is exported to the grid at the export tariff, and all consumption is imported at the retail tariff — there is no netting. This is less favourable for consumers. Before installing solar, confirm with your DISCOM which arrangement applies to new residential systems in your area.
Currently, net metering (not gross metering) remains the default for residential systems up to the sanctioned load in Rajasthan and most Indian states.
Timeline Expectations: How Long Does DISCOM Approval Take?
Under the MNRE guidelines and most state regulations, the DISCOM must complete the net metering installation within 30 days of the solar system commissioning. In practice, timelines vary:
- Major cities (Jaipur, Jodhpur, Kota): 15–30 days typically
- Smaller towns: 30–60 days
- Rural areas: 45–90 days, sometimes longer due to transformer assessment requirements
A good installer will proactively follow up with the DISCOM and escalate if timelines are missed. FGPS Solar handles all DISCOM correspondence on behalf of our customers at no additional charge.
