Three settlement regimes operate across India, and which one applies to you is decided by your state commission and your sanctioned load — not by your solar company. It is the single biggest factor in how much an exported unit is worth, and therefore in how large a plant you should build.
The three regimes
Net metering
Units exported to the grid are set off one-for-one against units imported, and you are billed only on the net. A unit you export in the afternoon is worth exactly as much as a unit you draw back that evening.
This is the most valuable regime for a plant that runs ahead of its load — a factory with weekend shutdowns, a seasonal operation, a site whose roof is larger than its demand. Most states cap eligibility by sanctioned load or by system size, and the cap is where a lot of C&I projects quietly fall out.
Net billing
Imports are charged at your normal grid tariff. Exports are credited at a separate solar tariff set by the regulator — almost always lower. The two are netted in rupees, not in units.
The consequence is straightforward and frequently missed: a unit you consume yourself is worth more than a unit you export. Under net billing, oversizing a plant to chase export credit destroys its own economics. This is the regime that applies to our 5.5 MWp plant at Supa, Maharashtra, under the MERC regulations of 2023.
Gross metering
The entire solar output is sold to the DISCOM at a notified tariff, and your whole consumption is billed at your normal tariff. The two settle against each other. Self-consumption carries no premium at all, because there is no self-consumption — everything goes out, everything comes back.
Why this decides your plant size
Under net metering, sizing to your annual consumption is reasonable. Under net billing or gross metering, the right target is your daytime coincident load — the demand actually present while the sun is up. Build past that and each additional unit earns the lower export rate rather than displacing a full-price one.
This is why every proposal we issue starts from twelve months of your actual bills rather than your roof area. Roof area tells us the ceiling. Your load profile tells us the answer.
Banking, and why it is disappearing
Several states have historically allowed surplus generation to be banked — parked with the DISCOM and drawn back later, within a window. Banking is what made intermittent solar behave like firm supply without a battery.
That is being withdrawn. Windows have shortened from annual to monthly or quarterly, banking charges have risen, and deviation settlement has tightened. Maharashtra has gone further, mandating co-located storage for new C&I solar above 100 kW from April 2026.
The practical reading: a battery is now the thing that replaces banking. It absorbs midday surplus and releases it into the evening peak, which is exactly the service the grid used to provide for free. Where the economics are not there yet, we still engineer the plant storage-ready, because retrofitting a DC bus is expensive and planning for one is not.
What to check for your own site
- Which regime your state applies at your sanctioned load, and whether a capacity cap bites
- The export or solar tariff, and how far below your import tariff it sits
- Whether banking is available, the window length, and the charge
- Your daytime coincident load, not your annual consumption
- Whether storage is mandated, and whether it pays before it is mandated
Settlement rules are state-specific and change with each commission order. Anything above is a general description, not advice on your connection — we confirm the applicable position against the current SERC order before quoting any project.