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Solar Subsidy for the Residential Sector in Punjab 2022 | HomeScape


The Government of India is promoting the goal of a “solar-powered green city” in every state, and it notes that the idea is in line with the global solar energy trends. Solar panel subsidy in Punjab is an initiative to make clean and green energy affordable and accessible.

Like the use of solar energy in commercial settings, it is ideal for installing solar in residential neighbourhoods, thanks to the progress in home solar systems. Now the residents of Punjab have an opportunity to increase their savings by reducing high electricity bills and their dependence on the government grid.

Solar System Price in Punjab with Subsidy

The Punjab State Power Corporation Limited (PSPCL) offers subsidy support for grid-connected rooftop solar systems of capacity ranging from 1 kW to 10 kW. The subsidy is expected to make solar panel prices in Punjab more affordable for the residential sector consumers.

The subsidy/ Central Financial Assistance (CFA) for a rooftop PV solar system will depend on the capacity of your solar system and its benchmarked cost or on the cost calculated through a competitive process, if lower.

  • For up to 3kW capacity of RTS system, the CFA applicable is 40% of the benchmark cost.
  • For systems of capacity ranging from 3kW to 10kW, the user will be eligible for a CFA of 40% for the first 3kW capacity. The additional 20% CFA will apply to the rest of the capacity above 3kW (i.e. up to 10kW). Capacities exceeding 10kW will not receive any subsidy.
  • The GHS (Group Housing Societies) / RWA (Residential Welfare Association) are eligible for availing 20% subsidy on benchmark cost, given that certain criteria are met. A single house can avail subsidy worth maximum 10kWp capacity of a rooftop solar plant. The total for the entire society should not exceed 500kWp.

It is important to note that power distribution companies (DISCOMs) are responsible for implementing the solar panel subsidy scheme in Punjab and other states. To be eligible for the above subsidies, your rooftop solar system must be installed by the vendors empanelled by PSEB.

Solar Subsidy Scheme in Punjab

The solar subsidy by Punjab is available for the state residents who wish to switch to solar electricity.

For the domestic sectors, the Punjab State Power Corporation Limited (PSPCL) will provide a maximum of 40% subsidy on benchmarked costs for installing rooftop solar power under net metering. Net metering doubles the benefits of going solar by saving you money and enabling you to earn more of it. Homeowners will first use the electricity generated through a rooftop solar system as per their requirement, and PSPCL will adjust your generated power from the total consumption. The net metering rules, however, are subject to change.

The PSPCL also notes that the solar rooftop subsidy scheme is only available for residential homeowners, registered societies, multi-story apartment buildings, and cooperative group housing societies. Non-residential sectors like educational, PSUs, private commercial, social, or industrial sectors are not eligible to benefit from the solar subsidy for homes in Punjab.

How to apply for Solar Subsidy in Punjab?

Early this year, the Ministry of New and Renewable Energy (MNRE) issued a new simplified rooftop scheme to make the solar subsidy process easier for homeowners. Although the power Distribution companies (DISCOMs) will still be the point of contact for availing solar subsidies in Punjab, the homeowners will now have lot more options to choose their solar developer of their choice from the list of MNRE-authorised vendors on the National Portal.

You can select any solar energy company which is registered on the National Portal for Rooftop Solar to design and install your home solar system. Once you have finalised the solar system for your home in Punjab, you can approach the local DISCOM to apply for the subsidy. All the processes are now happening online through the National Portal.

You will be able to notify the DISCOM company about your solar system installation through the same online portal. The subsidy disbursement process will start once your application and the requested document are submitted. The greatest advantage for homeowners in this process is that they will directly get the settled subsidy payout in their own bank accounts within 30 days from installing their solar setup.

What is Net Metering?

When purchasing a rooftop solar panel system for your home, you will have the option to connect your system to the grid. If you have opted for a net-metered solar system, you will be eligible to apply for the government solar subsidy scheme and enjoy the benefits of net metering. 

Net metering is a billing mechanism regulating grid-connected home solar systems. It allows homes that produce their own solar electricity to export unused power units to the government grid and earn solar credits which can be settled in the next billing cycle.

The grid also makes up for your solar electricity shortfalls, particularly at night or on a cloudy/rainy day when your solar panels don’t receive ample sunshine. The provision of net metering will ensure that your energy demand is met through grid electricity when solar energy production is insufficient. The imported units can be counted against the credits you’ve banked during the month.

Your monthly electricity bill can show a charge or even a positive credit balance based on the net of your energy contribution to the grid and the energy withdrawals from the grid. Hence, the name “net metering”. At the end of the year, if your annual billing shows a positive solar credit balance, the same will be paid out to you in cash as per the rate specified in the net metering provision.

Net metering doubles the benefits of going solar by saving you money and enabling you to earn more of it. Homeowners will first use the electricity generated through a rooftop solar system as per their requirement, and PSPCL will adjust your generated power from the total consumption. The net metering rules, however, are subject to change.

Benefits of Net Metering

Most solar experts advise favouring a grid-connected solar system as it increases the advantages of living in a solar-powered home. These benefits of net metering are:

Additional financial credit and savings

On days when your solar PV panels generate more energy than the daily electricity consumption needs, then the surplus units are sold to the grid for extra solar credits, translating to greater flexibility and more revenue for you.

Eliminates the need for battery storage and backup generator

Unlike off-grid solar systems, a grid-connected framework doesn’t require battery backup to store solar electricity, as any surplus production is fed to the utility grid under net metering. This makes your solar setup simpler and less expensive. Moreover, you can avoid paying for costly generators since the grid serves as a backup generator for your home.  

Affordable and easy to maintain

Home solar systems don’t demand a lot of maintenance efforts. Solar panels installed on your rooftop are covered with 25 years of performance warranty and are easy to maintain. Battery and generator require routine maintenance and replacements, but you can eliminate these components by opting for net metering. As a result, you can bring down the total cost of your home solar PV system and also reduce its maintenance requirements.

The Complete Process for installing Solar System in Punjab

To apply under the simplified rooftop solar scheme, you must first register on the national portal. This online portal can be accessed to keep up with the progress of your subsidy disbursement process, from the initial application to its tracking and approval. The Ministry also intends to set up separate portals for different regional DISCOMs, each linked to the national portal.

The revised mechanism requires the beneficiary planning to get a home solar system first to submit an application for the same on the national portal. You will have to furnish relevant details and documents about the intended rooftop solar plant (RTS) installation along with the bank account details for the subsidy payout.

The completed application will be assigned to the local DISCOM, and the status of your application can be tracked from the DISCOM portal. The approval is likely to be issued within the next 15 working days once the DISCOM ascertains the technical viability of your rooftop solar installation.

Once you have the approval, your chosen vendor can start the rooftop solar panel installation process. However, be mindful when selecting solar energy company for the installation and ensure that the solar modules fulfil the DCR conditions, and the company is registered on National Portal. Also, the manufacturers must be listed on the Approved List of Models and Manufacturers (ALMM) issued by the MNRE. Likewise, make sure your solar inverter is J3IS-certified.

The approved application will also specify a limited timeframe for the beneficiary to install the rooftop solar plant, after which the application will be ineffective. If consumers fail to get their solar system set up by the prescribed date, they can re-apply via the same process.

Once the solar setup is ready, the next step is to apply for net metering through the same national portal. The local DISCOM managing your application will arrange for net metering, wherein either the DISCOM or the beneficiary will be liable for procuring the net meter. All announcements throughout the process will be published on the portal.

Lastly, the officer assigned by the DISCOM company will prepare a commissioning and inspection report, which the beneficiary can view on both the DISCOM and national portals. A positive report will approve your eligibility to receive the subsidy amount in your account.


Financial support for the country’s renewable sector is key to its goal for the clean energy transition. Hence, we can expect subsidy programs for the residential sector to continue for the foreseeable future.

Although the uptake of rooftop solar installations in the residential sector has been slow, partly due to a lack of awareness about solar power and the subsidies available, the situation is expected to improve. As the state government strengthens its subsidy disbursement process, more houses will be solarized in the future.

Now is a great time to take advantage of the solar subsidy schemes for homes in Punjab. At HomeScape by Amplus Solar, we have years of expertise installing aesthetically appealing, highly durable, grid-connected rooftop solar solutions customized to each homeowner’s needs. If you need help determining subsidized solar panel prices in Punjab for your residential space, we encourage you to book a consultation with us today.


What is the cost of solar panels in Punjab?

To understand how much a solar panel costs in Punjab for you, you need to factor in the type of solar plant and number of solar panels that make your rooftop solar PV system. An easy way to figure out the solar panel price for your home is to discuss your solar needs with an experienced solar installer near you, like HomeScape by Amplus Solar.

Is there a subsidy for solar panels in Punjab?

The solar subsidy in Punjab is available for the state residents who wish to switch to solar electricity for their domestic needs. The PSPCL notes that the solar rooftop subsidy scheme is only available for residential homeowners, registered societies, multi-story apartment buildings, and cooperative group housing societies. Non-residential sectors like educational, PSUs, private commercial, social, or industrial sectors are not eligible to benefit from the solar subsidy for homes in Punjab.

How much subsidy is available on solar panels?

For the domestic sectors, the Punjab State Power Corporation Limited (PSPCL) will provide a maximum of 40% subsidy on benchmarked costs for installing rooftop solar power plants of up to 3kW capacity under net metering. If you pick a system of 3kW to 10kW capacity for your home, you can avail 40% for the first 3kW capacity and an additional 20% subsidy for the rest (up to 10kW).

How can I get a solar subsidy in Punjab?

Thanks to the MNRE simplifying the rooftop solar subsidy scheme for homeowners intending to get solar for their homes, you can select a home solar installer you see fit for your needs and later apply for subsidy online. For personalised guidance, HomeScape welcomes you for a one-on-one consultation to see how solar can be beneficial for meeting your energy needs.

Which type of solar system is eligible for the subsidy?

A solar subsidy is only applicable on grid-connected home solar plants (excluding the battery system, if any is opted for). The subsidy will be calculated based on the benchmark cost issued by the MNRE for different system capacities.

How much time will it take to release the subsidy?

You can expect to receive the subsidy amount in your account within 30 days from the day of solar system installation, considering that your online application has been duly approved.

Net Metering

How the newly introduced MERC’s net metering plans benefit solar power users in the domestic sector?

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In the last month of 2019, the Maharashtra Electricity Regulatory Commission (MERC) set up draft guidelines withdrawing net-metering facilities for some consumers, limiting to gross-metering facilities only. After much criticism from the expert panels, including the Maharashtra Solar Sanghatan, the MERC has done away with the plan, mainly benefitting domestic rooftop solar plant users.

Net Metering Vs. Gross Metering

Solar plant for a home may have the capacity to produce more electricity than what is consumed. However, as storage is expensive, they can opt for a facility where the solar rooftop panels are connected to the grid, also known as grid-tied solar kits. Excess electricity is sent back to the network and power is consumed from the grid if there is a deficit. Distribution companies, generally referred to as DISCOM, buy the excess electricity and sell it to other consumers. In a gross metering arrangement, the consumer is required to sell the total units of electricity generated at a fixed rate back to the DISCOM. The speed at which the DISCOM buys the electricity is typically lower than the retail supply rate. All units of electricity generated by the rooftop solar power plant have to be sent to the grid, and therefore a gross metering arrangement uses a unidirectional meter. A gross-meter will tell you exactly how many units of electricity your solar panel generated. In a net-metering arrangement, a bi-directional system is used. You are allowed to consume the electricity generated by your rooftop solar panels for home use. Whatever units are unused is sold to the DISCOM. Whatever you drank from the grid (if you have a deficit), is accounted for in the final bill. Both imports and exports are calculated by net-meter.

Advantage of Net Metering over Gross Metering

In a net-metering arrangement, compensation is calculated typically at retail supply rates. However, in a gross-metering method, the compensation is generally lower than retail supply rates. This is the reason why DISCOM companies discourage the use of net-metering and encourage the use of gross-metering as a revenue protection measure. Moreover, with a gross-metering arrangement, you do not have direct savings on your electricity bill. Instead, you are merely earning an additional income each month by selling electricity to the grid. It may typically take longer to break even on your rooftop solar panel investment with net-metering (depending on capacity and usage). To encourage solar production, governments set up rules and regulations that help residential solar systems and commercial and industrial setups of solar power generators to have maximum savings and can see a return on investment at the earliest. However, they are also obligated to protect the interests of DISCOM, and for these reasons, they set tariffs based on caps.

Draft vs final regulations

The draft proposal for net metering policy in Maharashtra said that consumers with more than 300 units of electricity generation per month, will compulsorily have to sell anything excess of 400 units at a fixed tariff rate of Rs 3.64/unit. The prices for the purchasing power was around Rs. 10-Rs. 11. This means if 1,000 units are generated from the rooftop solar plant, and 800 units are consumed, the home solar system user will still have to pay for 500 units (at the tariff rate applicable), as the offset is only for 300 units. Moreover, Rs. 3.64/unit was completely unacceptable as it clearly favours the interests of the DISCOM, discouraging rooftop solar panel generators altogether. At such a miserly rate, the return of investment for the rooftop solar panel would take much longer as the savings on the electricity bill would be negligible is any at all. In comparison, if a proper net-metering system is used, the solar energy for home, generated by the rooftop solar panel is first consumed for internal/captive requirements. Only the excess is sold to the grid. Subsequently, the consumer’s intake from the grid, the exports and imports would be adjusted. This would lower the electricity bill significantly. These regulations seem to have been completely taken in the interests of DISCOMs only and acted as a hindrance in achieving the central government’s goal of 100GW of solar by 2022. Environmentalists across the state widely criticized the move. Since the purpose of combating climate change had not been taken into consideration at all. It would curb any new instalments of solar panels, which would also offset India’s independence form import of fossil fuels. Encouraging solar not only has direct ecological and economic benefits, it also urges employment and revenue generation. After much ado from the solar enthusiasts of the state, the MERC has made sweeping changes to the old proposal. The new rules are in keeping with the motive of encouraging solar across the country. In the final proposal, the cap on 300 units has been removed entirely, and net-metering is made available for all generators (residential, commercial and industrial). There is other good news for subsidy on solar panels in Maharashtra as well. Earlier, the registration fees for small consumers was Rs 500 for up to 5KW and Rs. 1000 after that. With the current regulations, the costs will now be Rs. 500 for up to 20KW and Rs. 100 per 20 KW after that.


The new regulations set by the Maharashtra government come as a welcome respite for all rooftop solar panel generators and has been taken in the right direction. Maharashtra has been at the forefront of the solar revolution in the country and targets to produce 11,926 MW of solar by 2022. Listening to the voices of solar power enthusiasts, these new rules by far seems to be the most progressive decision for encouraging solar power generation. The new rules are in line with the economics of rooftop solar panels benefits of net-metering against gross-metering. With the rates of some of the best solar panels for home use decreasing rapidly, domestic users in Maharashtra can give solar power system for homes a serious consideration to make significant savings on electricity in the long run. The new proposal brings new hope to net-metering lobbyists who take a substantial review of the economic benefits to domestic solar fanatics of the state.

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