An on-grid or grid-tied solar system is a system that works along with the grid. This means that any excess or deficiency of power can be fed to the grid through net metering. Many residential users are opting for an On-grid solar system as they get a chance to enjoy credit for the excess power their system produces and save on their electricity bills. You will always have power either from the solar system or from the grid. They do not have batteries.
Product Market Size & industry
The solar market in India is very attractive and the country is expecting investment worth $500 billion in renewable energy by 2028. India has a target to reach 227 GM of renewable energy by 2022 of which about 114 GW is planned for solar, 67 GW for wind, and balance for hydro and bio among others. The country’s installed renewable energy capacity stood at 94.43 GW as of February 2021. It is expected that by 2040, around 49% of the total electricity will be generated by renewable energy. In addition, the Government of India wants to develop a green city in every Indian state, powered by renewable energy.
In order to achieve the above target, the Indian Government has launched several schemes to encourage solar power generation in the country like Solar Park Scheme, VGF Schemes, CPSU Scheme, Defence Scheme, Canal bank & Canal top Scheme, Bundling Scheme, Grid Connected Solar Rooftop Scheme, etc. Many policy measures are also undertaken to promote the on-grid solar power plants.
How It Works?
In an on-grid solar system, solar panels will continue to produce power during the day. This power can either be used instantly or exported to the grid with no backup for power outages. If at any time the system runs out of power, it draws the same from the electricity grid. Hence, a user will never run out of power in this case. Similarly, any excess that is produced by the system is fed to the grid. The advantage of an on-grid system is that the user will get a credit in his electricity bill for the extra power he sent to the grid. So, his electricity bills will also reduce. Always assess your Home's Energy Consumption, Solar Potential, Solar Electricity Needs, etc. before installing an on-grid solar system.
The light from the sun falls on the solar panels from where electricity is generated. This DC from the sun is converted into AC with the help of the inverter, which is then used by consumers in their homes or any commercial establishment. Till this stage operations of any solar system is the same. The main difference is beyond this point. After the electricity that is consumed by us, there can be two routes for the extra energy generated:
1. It can be either stored in batteries for use at a later part of the day (off-grid solar system) or
2. Fed to the grid (on-grid solar system). Based on the feed-in-tariff rates (tariff fixed by the government, for purchase of the solar power generated from solar plants) in your area, your electricity bill is reduced for the amount of power that you have sold to the power grid.
1. Guaranteed 24*7 power supply - With an option to use either solar power or the main power grid, the consumer will always have access to power and will never suffer from a power outage.
2. Opportunity to earn more - With the help of a net meter installed at your home, you can track the number of units you sent to the power grid and claim a credit for that in your home electricity bill. This forms a lucrative option for the consumers who think of it as an extra opportunity to make money. Almost all the states in the USA and even India have mandated Net Metering.
3. More Savings - The main purpose of installing an on-grid solar system is to reduce your electricity bills. You can adjust the usage depending upon peak demand hours and hence end up paying no peak demand charges. These are the higher rate of charge that the utility charges for using the grid during high-demand hours. Also, you end up paying less on electricity bills and earn more through Net Metering.
4. Good Investment Returns - An on-grid solar system offers a good investment option. It has 5 years as payback time and provides free electricity for the next two decades. You can convert your own property into a revenue-generating avenue by investing in solar and achieving ROI in just 4-5 years.
5. Works efficiently - The on-grid system works in sync with the grid. There is no limitation in the grid-tied system, you can run any home appliance on the grid-tied solar system. Also, it utilizes 100% of solar power produced from solar panels. For example, a 1 kW on-grid system can run 5 kW power.
6. Easy to install - Installation of an on-grid system is easy and can be done easily by oneself on the rooftop. It can be easily installed on residential rooftops, rooftops of commercial complexes, housing societies, community centres, government organizations, private institutions, etc.
7. Less Costly - Since an on-grid solar system does not require batteries, it is cheaper to install when compared to an off-grid system. It is less costly when compared to other solar systems.
8. Less Maintenance - An on-grid solar system involves less maintenance and generally has a longer life when compared to an off-grid system.
9. Subsidies and Other Incentives - A user can avail of government subsidies and other incentives to install on-grid solar systems.
*Does not come with backup, the system does not work when there is a power cut.
1. Solar Panel -Solar panels are the main components of the on-grid solar system. They comprise more than 50% of the total cost of a solar system and are the components that capture solar energy and convert solar energy into electrical energy.
2. Solar Inverter -Solar Inverters help in converting the DC output produced from the solar panel into AC supply.
3. Panel Stand -Panel stands are also a major component of the entire solar system. Some people do not give much heed to this component and try and save a few bucks by using a low-quality stand. However, remember that this stand will support the solar panels and if the stand is not sturdy your solar panels could just fall resulting in a heavy loss. It is the skeletal structure holding the panel in the proper position. These stands are generally made of aluminum or galvanized iron. Solar panel stands can be fixed or movable to track the sun.
4. Solar Wire -Solar Wire or Solar Cable is the medium through which electricity is transferred from solar panels to the inverter. Generally, there are two types of wires in the market, such as AC Wire and DC Wire. It is called a solar wire as the solar panel output is DC current.
5. DCDB / ACDB - DC Distribution Board or DCDB is used for connecting the output power from the solar panel to the input of the inverter while AC Distribution Board or ACDB distributes the electrical power from a solar inverter to the AC load system through an energy meter.
6. Earthing Kit - An earthing kit is used to protect the on-grid solar system from thunder.
7. Lighting Arrestor - Lightning Arrestor is used to protect the on-grid solar system from lightning
8. Net Meter & Solar Meter -Net metering is a special metering and billing agreement between utilities and their customers, which facilitates the connection of small, renewable energy-generating systems to the power grid. It is an important component in an on-grid solar system as it keeps the reading to claim credit in your future electricity bills. For solar energy, Net Metering is also very important as solar energy unlike other forms of renewable energy is produced a lot in residential and commercial segments.
9. Safety Equipment - To safeguard the solar system from damages such as lightning and other faulty conditions, protection devices are used. These comprise of surge arrestor, circuit breaker, grounding method, etc.
10. Installation Accessories - These include installation accessories like wires, cabling, mounting structures, junction boxes, etc.
Cost of Grid Connected Solar System
Selling Price (all inclusive)
1kW Grid Connected System
2kW Grid Connected System
3kW Grid Connected System
5kW Grid Connected System
7.5kW Grid Connected System
10kW Grid Connected System
15kW Grid Connected System
25kW Grid Connected System
According to MNRE Benchmark Cost is the lowest quoted project cost for a rooftop solar system up to 1 kW was ₹50,000/kW, ₹47,000/kW for a 1 kW to 2 kW system, ₹45,000/kW for a 2 kW to 3 kW system, ₹44,000/kW for a 3 kW to 10 kW system. For the systems of 10 kW to 100 kW, the lowest project cost quoted was ₹38,000/kW and ₹36,000/kW for systems of 100 kW to 500 kW. But, if any consumer wants to install a grid connected solar system without a subsidy scheme, the cost of grid connected solar system is ₹ 60,000 to ₹ 80,000 all inclusive. The information you are reading has been last updated on.
How to Install On Grid Solar System?
Government Subsidy Scheme on Rooftop Solar
In March 2021, Haryana announced a scheme with a 40% subsidy for a 3 KW plant in homes, in accordance with MNRE's guidelines, to encourage solar energy in the state. For solar systems of 4-10 kW, a 20% subsidy would be available for installation from specified companies. You can get subsidies on solar system Haryana state's location, such as Karnal, Hisar, Rohtak, Gurgaon, Yamuna Nagar, Sonipat, Panipat, Ambala, Sirsa, Rewari, Ratia, Mandi Adampur, Kaithal, Faridabad, Kurukshetra, Bhiwani, and more.
One can get a capital subsidy of up to INR 20,000 per Kilowatt. However, the eligible party should have a grid-connected, battery-less system and should be a domestic consumer to claim the benefit. Also, the system should be Made in India. MNRE has also prescribed CFA to residential customers for installing grid-connected solar rooftop (4 GW):
CFA @ 40% for capacity up to 3 kW
CFA @ 20% for capacity beyond 3 kW and up to 10 kW
CFA @ 20% for GHS/RWA capacity up to 500 kW (limited to 10 kW per house and total upto 500 kWp)
Domestic manufactured modules and solar cells should be used. CFA shall be on % of the benchmark cost of MNRE for the state/ UT or lowest of the costs discovered in the tenders for that state/ UT in that year, whichever is lower. The residential consumer who wishes to seek CFA has to approach the DISCOMs operating in his area for installation of rooftop solar plant and get the CFA. Read state wise solar subsidy scheme from here: https://www.loomsolar.com/blogs/subsidy
Net Metering Process
For a grid-connected solar system, any excess power generated can be sold back to the grid and the customer will be credited for that. But how would you determine the amount of the credit in your electricity bill? Does it make sense to sell excess power to the grid? Could I not benefit from the extra energy generated? Let’s take a look at how to answer all these questions.
On-grid solar system is very popular in western countries. This program is successfully running in countries like Australia, Canada, Italy, Spain, Denmark, and the United States. In India, net metering could act as an important incentive for consumer investment in onsite renewable energy generation and encourage consumers to go solar. In India too, grid-connected ground-mounted systems exceeded their 9 GW installation target for 2017-18 and installed a total of 9009.81 MW. Despite nearly all the Indian states announcing net metering policies for rooftop solar, there are practical issues around grid integration and DISCOM finances. Check Net Metering Process, Documentation & How to Apply State wise from here: https://www.loomsolar.com/blogs/net-meter
Return on Investment
The economics of rooftop solar energy in India has become extremely compelling. It makes great sense for commercial and industrial customers to use rooftop solar energy as it has become much cheaper than the grid electricity. You can convert your own property into a revenue-generating avenue by investing in solar and achieving ROI in just 4-5 years.
One Time Investment
Solar Return vs. Financial Investment
If you have ₹ 5,00,000 and are looking for the best investment options, then I will choose which investment option generates the maximum return. Below is the compression table of Solar Return & Other Financial Investment Options. "A penny saved is a penny earned" - Benjamin Franklin
7500 units x ₹ 7.5 per unit
10-12% YoY returns
How to decide the best solar system?
1. Installation Space: Installation of an on-grid system is easy and can be done by oneself on the rooftop. A minimum of 100 square feet is required for every Kilowatt of installation.
2. Solar Subsidy Scheme: An entity installing an on-grid rooftop solar system enjoys several incentives and subsidies from the government, which differs from state to state and is also different for countries.
Maharashtra - The Maharashtra Electricity Regulatory Commission (MERC) has allowed for the benefits of net metering on rooftop solar installations of up to 1 MW in size.
Kerala and Rajasthan - Similar policies exist in Kerala and Rajasthan.
Tamil Nadu - While Tamil Nadu does not prescribe net metering laws for industrial establishments. Other than attaining the green credential, a 20% subsidy is available on an on-grid solar system.
On Grid Solar System FAQs
How to choose a solar system capacity for my home?
How much electricity do you consume per month from your gird supply? This is the main criteria to select solar system capacity. Please note, The purpose of installing on-grid solar system is to reduce electricity bill. Below is the table to understand how to choose on-grid solar system capacity based upon power consumption and monthly electricity meter reading.
Average daily power consumption (units)
Estimated monthly bill @ Rs. 10 per unit
Recommended on grid solar PV system (kw)
₹ 0 – ₹ 1,500
₹ 1,500 – ₹ 3,000
₹ 3,000 – ₹ 4,500
₹ 4,500 – ₹ 7,500
₹ 7,500 -₹ 15,000
50- 125 units
₹ 15,000 – ₹ 35,000
How much will the grid-tied system cost?
On-grid solar system price varies with the selection of brands, quality of products used, and system replacement warranty. Latest price list of the on-grid solar system in India.
On-grid solar system
Price (all inclusive)
What happens, when my power consumption is very low?
The advantage of on-grid solar system is awesome, if you are not using electricity at your home, the power generated from solar system will be fed back to the grid. The state government will give you money for sending electricity to gird.
Which Solar Brands and Products are the Best?
The number of brands offering solar energy products is rapidly increasing. And each solar expert you speak with will have certain products they recommend, and they usually have very convincing reasons for recommending those products. This can make it a challenge for consumers to know whose opinion to trust, and which products are truly the best.
An on-grid solar system is a grid-connected solar PV System which works along with the grid. In the Grid-Tied solar system for home, Loom Solar has tied up with the Chinese solar giant, Trina Solar for the distributorship of its Trina Home solution, which is a complete solar rooftop home solution customized for India. Available in 3 kW, 5 kW, and 10 kW capacities, these kits come with a 25-year module performance warranty. It is suitable for installation in residences, schools, hospitals, SME establishments etc.
Can I Get Subsidy for Solar Energy Systems in Haryana?
Yes, you can get subsidy on solar system Haryana state's location, such as Karnal, Hisar, Rohtak, Gurgaon, Yamuna Nagar, Sonipat, Panipat, Ambala, Sirsa, Rewari, Ratia, Mandi Adampur, Kaithal, Faridabad, Kurukshetra, Bhiwani and more.
So how do you choose? - Our best suggestion is to find a solar expert/professional you trust and allow them to guide you through the ever-changing maze of renewable technology. Loom Solar helps 1 million solar buyers every month. So, Go Solar...Think Loom Solar.
How to Install On-Grid Solar System?
On-grid solar is preferred by masses as it provides an additional advantage to earn from your solar system. People can install on-grid solar systems and enjoy the benefit of net metering policies to avail credit in their electricity bills. But before the installation, a buyer has numerous questions in his mind regarding the concept, subsidies, suppliers, method of installation, prevailing net metering rules etc. In this article, we attempt to answer all these queries.
Which appliances run on the grid-tied solar system?
The on-grid system works in sync with the grid, unlike inverters, there is no limitation in the grid-tied system, you can run everything off your home on the grid-tied solar system. For example, a 1 kW on-grid system can run 5 kW power.