The Commercial and Industrial (C&I) sector can get a 20-25% return on investment (RoI) by investing in rooftop solar.

At the recent C&I Clean Energy Meet hosted by Mercom India in Mumbai, leading open access and rooftop solar developers shed light on the financial savings from shifting to solar.

Representatives from Kalpa Power, Adani Solar, and Soleos Solar Energy participated in the discussion.

Savings

Rounak Muthiyan, Managing Director of Kalpa Power, stated that customers must choose between rooftop or open access based on the quantum of savings and charges they are willing to pay.

“In rooftop solar, consumers can replace not more than 55% of energy consumption, and in open-access, they can stretch that to 75-80%. Solar energy allows consumers to offset in real-time when the generation happens. In open access, they can bank the power and compensate it in a particular period. As per the current policy, consumers can offset renewable energy for 20 hours a day in open access, and with rooftop solar, they can get 12-16 hours a day to offset. Under open access, consumers will have to pay a tariff for using the state electricity grid estimated at ₹1 (~$0.011)/kWh-₹4 (~$0.046)/kWh,” said Muthiyan.

He added that every listed company in the U.S. or exporting to the country must submit carbon avoidance plans to the U.S. Securities and Exchange Commission and the Securities and Exchange Board of India. “Suppliers in developed countries are mandated to set down their scope avoidance plans. Banks have a balance sheet reduction of sustainable behaviors, which mandates all financial institutions to lend to renewables,” added Muthiyan.

Additionally, under Section 32 of the Income Tax Act, companies can benefit from a 40% accelerated depreciation and an additional 20% on projects and machinery for micro, small, and medium enterprises. The solar asset’s book value with a project life of ten years can be written off to zero in three to three and a half years.

Experts pointed out that the electricity tariffs for commercial units ranged between ₹14 (~$0.16)/kWh and ₹22 (~$0.25)/kWh, and for industries it was in the ₹9 (~$0.105)/kWh to ₹12 (~$0.14)/kWh range.

With rooftop solar, consumers can save up to six times compared to the grid tariff. This means, against the DISCOM tariff of ₹10 (~$0.117)/kWh, they can avail solar power between ₹1.5 (~$0.017)/kWh and ₹2 (~$0.023)/kWh. Open-access consumers can buy solar power at around ₹4 (~$0.046)/kWh, resulting in 60% savings.

Experts said that customers are looking for payback between two and a half to four years, and solar energy can provide an assured return of 20%.

Animesh Jain, Regional Head- West, Adani Solar, said, “The C&I sector is aiming to achieve 7.5 GW rooftop solar installations by the end of this year. There are multiple forces driving this, but a 20-25% ROI per year makes for an attractive solution.”

Growing Demand for Solar

Experts said the demand for open access is increasing in the C&I sector.

Bhavesh Kumar Rathod, Founder and Director of Soleos Solar Energy, said that with a major policy push, increasing electricity costs, and decreasing costs of solar projects, the demand for solar power from C&I consumers is expected to surge.

Rathod said the demand also comes from companies intending to go green and export-oriented companies who must meet 100% ESG goals.

“India is tripling its solar capacity and will be able to reach five times the capacity within five years,” he said.

Experts said there is sufficient demand for solar capacity additions from existing and strong demand from new consumers. However, consumers are holding back due to a lack of policy clarity on rooftop solar and open-access projects.

At the C&I Clean Energy Meet hosted by Mercom in Chennai on March 7, 2025, industry experts from leading financial institutions also discussed multiple lending options, loan structures, and interest rates available for businesses investing in solar energy.

The next Mercom India C&I Clean Energy Meet event will be held in Pune on May 16, 2025.

Contact us if you plan to install solar and need guidance or vendor recommendations.