Maharashtra’s solar push faces backlash
Consumers who invested heavily in rooftop solar face new grid charges and curbs on banking
Mumbai: A fresh set of directives by the Maharashtra Electricity Regulatory Commission (MERC) has triggered widespread discontent among rooftop solar consumers, marking a decisive shift in the state’s renewable energy policy—from incentives and subsidies to cost recovery through grid-related charges.
At the heart of the backlash is a structural change: solar consumers, who were encouraged for years to invest in de-centralised generation, are now being asked to pay for using the grid—even for electricity they generate and consume themselves. For many, this alters the financial viability of projects worth hundreds of crores, and risks eroding trust in government-backed energy transitions.
Policy shift alters solar economics
India’s solar mission, driven by aggressive capacity targets and fiscal incentives, saw rapid adoption across households, commercial establishments and industry. Maharashtra, after a slow start, emerged as a key contributor to the country’s installed solar capacity, which stood at over 150 GW as of March 31, 2026.
The model was simple: generate solar power, consume what you need, and export surplus to the grid under net metering, earning credits or payments. Subsidies and concessional financing further sweetened the deal.
However, MERC’s latest order introduces grid support charges, higher banking fees, and tighter restrictions on the time window for energy banking.
The changes, though technical in design, signal a deeper policy recalibration—one that prioritises grid sustainability over de-centralised autonomy.
Consumers will now pay charges not only for exporting power but also for self-consumption routed through the grid. Simultaneously, banking charges have risen sharply, and the window to use stored energy has been cut from 17 hours to just 8 hours, reducing operational flexibility.
The result: solar projects may increasingly serve only real-time consumption needs, undermining their earlier promise of round-the-clock cost savings. This could push consumers towards expensive battery storage solutions, further complicating project economics.
Net Metering
While the net metering framework remains intact, the tariff for surplus power has been reduced significantly. This tilts the model away from profit-making and towards self-consumption, effectively discouraging large-scale rooftop investments aimed at revenue generation.
In parallel, time-of-day tariffs—cheaper during solar generation hours and higher during peak demand—signal an attempt to reshape consumption behaviour. But industry stakeholders warn that such measures could dampen fresh investments in the sector.
Financial Stress
The regulatory shift also reflects the financial strain of Maharashtra’s power distribution ecosystem. Mounting subsidy arrears owed by the state government to distribution companies have weakened balance sheets, forcing a search for new revenue streams.
Key Changes
Introduction of grid support charges
Banking charges increased from 2% to 8%
Banking window reduced from 17 hours to 8 hours
Net metering retained with additional conditions
Tariff for surplus solar power reduced to Rs 2.82 per unit
At a time when India is pushing aggressively towards renewable energy to meet climate and energy security goals, policy consistency remains critical. Maharashtra’s latest move, while addressing immediate fiscal concerns, risks slowing rooftop solar adoption – particularly in the commercial and industrial segments.
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