What is a good solar payback period in India?

In India, the average payback period is typically 4 to 6 years due to high electricity tariffs and government subsidies like the PM Surya Ghar Yojana.

How does the subsidy calculator work?

Enter your region and system cost. The calculator allows you to input the percentage of subsidy available in your state or country (e.g., 30% in USA, flat rates in India) to calculate net ROI.

Solar Payback Calculator

Estimate your Return on Investment (ROI) and Savings.

Select Region / Currency

System Costs

Total System Cost

₹

Subsidy / Tax Credit

Central & State subsidy estimate.

Energy & Usage

System Size

Daily Sun Hours

Hrs

Electricity Rate

₹ /unit

Tariff Inflation 3%

Payback Period

Years to Break Even

Net Cost

Year 1 Savings

20-Year Lifetime Savings

Cumulative Savings

Is Solar Worth the Investment?

Switching to solar energy is one of the smartest financial decisions a homeowner can make. This Solar Payback Calculator helps you determine exactly how long it will take for your system to pay for itself through electricity bill savings, customized for India, USA, and Europe.

💡 Solar Incentives in India

Under the PM Surya Ghar: Muft Bijli Yojana, the Government of India provides substantial subsidies for residential rooftop solar. Currently, you can get a subsidy of up to ₹30,000 per kW for systems up to 2kW, and ₹18,000 for additional capacity up to 3kW.

How to Calculate Your Solar Payback Period

The "Payback Period" is the time it takes for your cumulative energy savings to equal the net cost of the system. Here is how we calculate it:

Calculate Net Cost: Subtract subsidies (Central/State) or Tax Credits (like the US 30% ITC) from the upfront installation quote.
Estimate Production: Multiply your system size (kW) by your local sun hours (Avg. 4-5 hours in India) to find daily generation.
Calculate Savings: Multiply the generated units (kWh) by your current electricity tariff (e.g., ₹7-10/unit).
Factor Inflation: Utility rates rise over time (typically 3-5% per year). Our calculator compounds this to show accurate long-term savings.

Key Factors Affecting ROI

Location: India receives abundant sunlight. A 3kW system in Rajasthan or Maharashtra produces more than in Himachal Pradesh.
Electricity Tariffs: States with higher tariffs (like Maharashtra, West Bengal, Kerala) see faster payback periods (3-5 years).
System Efficiency: We use a standard 80% efficiency derating factor to account for heat loss, dust, and inverter efficiency.

Frequently Asked Questions (FAQ)

What is the average solar cost in India? +

For a residential 3kW system, the cost typically ranges from ₹1.8 Lakhs to ₹2.5 Lakhs before subsidy. After subsidy, the net cost significantly reduces, offering a great ROI.

What happens after the payback period? +

Once you break even, every unit of electricity generated is essentially free. Since modern panels have a lifespan of 25 years, you enjoy 15-20 years of free power.

Does solar increase property value? +

Yes, globally, homes with solar installations are valued higher. In India, it's becoming a desirable feature for reducing monthly maintenance costs in societies and independent houses.

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