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Everything to Know about : Surya Ghar Muft Bijli Yojana (Roof-Top Solar Scheme for Free Electricity)

The Prime Minister, Shri Narendra Modi, today announced the launch of rooftop solar scheme for free electricity - PM Surya Ghar Muft Bijli Yojana. 

"In order to further sustainable development and people’s wellbeing, we are launching the PM Surya Ghar: Muft Bijli Yojana. This project, with an investment of over Rs. 75,000 crores, aims to light up 1 crore households by providing up to 300 units of free electricity every month."

"From substantive subsidies, which will be given directly to people’s bank accounts, to heavily concessional bank loans, the Central Government will ensure that there is no cost burden on the people. All stakeholders will be integrated to a National Online Portal which will further convenience."

"In order to popularise this scheme at the grassroots, Urban Local Bodies and Panchayats shall be incentivised to promote rooftop solar systems in their jurisdictions. At the same time, the scheme will lead to more income, lesser power bills and employment generation for people."

Current Status of the Solar Roof-Top

Potential of India: Based upon the availability of land and solar radiation, the potential of solar power in the country has been assessed to be around 750 GW.

Total Installed Solar Roof-Top Capacity is 11.1 GW (in which Residential is 2.7GW).

Potential for Rooftop is 43GW.

Target for Rooftop is 40GW by 2026.

Some Basic Details

What is the Subsidy Structure for Residential Households?

Rs. 30,000/- per kW up to 2 kW

Rs. 18,000/- per kW for additional capacity up to 3 kW

Total Subsidy for systems larger than 3 kW capped at Rs 78,000

Suitable Rooftop Solar Plant Capacity for households

Average Monthly Electricity Consumption (units)

Suitable Rooftop Solar Plant Capacity

Subsidy Support


1 – 2 kW

Rs 30,000 to Rs 60,000/-


2 – 3 kW

Rs 60,000 to Rs 78,000/-


Above 3 kW

Rs 78,000/-

Apart from this subsidy is also being provided by the respective State Governments.

What is a Grid Connected Rooftop Solar PV System?

In grid connected rooftop or small solar photovoltaic (SPV) system, the DC power generated from solar panel is converted to AC power using power conditioning unit/Inverter and is fed to the grid.

What are the main components of a Grid Connected Rooftop Solar PV system?

  • Solar PV Modules/Solar Panels – The Solar PV modules/Solar Panels convert solar energy to DC (direct current) electrical energy. They are available in different technologies such as crystalline silicon, thin film silicon, CIGS, CdTe, HIT, etc. Crystalline Silicon Solar PV panels are most commonly used in solar rooftop system. Multiple panels are connected together to form arrays as per the desired capacity of the system.

  • Inverter – Inverter converts variable DC output of Solar PV panels into AC power. Inverter also synchronizes with the grid so that generated power from the module can be injected into the grid.

  • Module mounting structure – The module mounting structure, is the support structure that holds the Solar PV panels in place for full system life and is exposed to all weather conditions. These are normally fixed at particular angle and orientation in case of solar rooftop system. But these can also be of type that tracks the Sun, called as trackers.

  • Bi-direction Meters – Meters are used to record the generation or consumption of electricity. Bi-direction (or Net-Meters) are used to keep track of the electricity that solar PV system injects to utility grid and the electricity that is drawn from the utility grid.

  • Balance of System – These consist of cables, switchboards, junction boxes, earthing system, circuit breaker, fuses, lightning protection system, etc.

What is the daily energy generated from a 1 kWp Solar Power Plant?

On a clear sunny day, 1 kWp solar power plant can generate 4 to 5.5 units in a day

What are the advantages of Grid-Connected Rooftop Solar System ?

  • Saving on electricity bill by the consumer.

  • Utilization of available vacant roof space, no additional land required.

  • Low gestation period.

  • No additional requirement of transmission and distribution (T&D) lines.

  • Reduces T&D losses as power consumption and generation are collocated.

  • Improvement in the tail-end grid voltages and reduction of system congestion.

  • Long term energy and ecological security by reduction in carbon emission.

  • Better management of daytime peak loads by DISCOM/ utility.

  • Meeting of the Renewable Purchase Obligations (RPOs) of obligated entities.

What is net-metering?

All solar PV systems generate power only during daytime when sun is available. In net metered systems, the generated power is utilized for self-consumption, and excess power is exported to the grid as long as grid is available. In case, where solar power is not sufficient due to cloud cover etc., power is drawn from the grid to power the loads. A bi-directional or net meter records the energy flow in both the directions and at the end of billing period net energy used is calculated. The beneficiary has to pay for only the net energy used (Export into Grid-Import from Grid).

Can I make my monthly electricity bill ‘zero’ by installing RTS?

This is possible in very rare cases because the consumer shall be required to pay some minimum charges like fixed charges, etc. even if the consumed energy is all self-generated. However, ‘electricity charges’, a major component of the monthly bill, can be reduced to zero by optimally designing and maintaining the RTS. The monthly electricity bill may come to zero in States which give revenue for surplus power generated.

What is Gross Metering?

In gross metering the power generated from the Rooftop Solar plant is only fed to the grid. The system owner gets paid by the DISCOM for such exported power at a pre-decided tariff.

What is Net billing?

Connections in net billing RTS are similar to net metering. However, at the end of the billing cycle (normally a month) any excess energy in the grid shall not be carried forward like in net metering, but shall be purchased by the DISCOM as per pre decided tariff. Therefore, energy banking in the grid is only within a billing cycle.

Can the RTS be installed for only captive use without being connected to Grid?

Yes, the plants which are not connected to the grid are normally called behind the meter plants and MNRE subsidy is not available for such plants even for residential sector. However, it is required to follow rules and regulations specified for this purpose by the state authorities.

Whether solar module should be made of indigenously for subsidised projects?

Yes. Only indigenously manufactured PV modules with indigenous solar cell can be used in Solar PV systems power plants for subsidised sector projects. However, there is no such limitation in case the project installed without any subsidy.

Disclaimer: The above information is purely for academic purpose.

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