PM Surya Ghar Yojana: How Much Rooftop Solar Costs And When You Recover The Money

The Centre’s PM Surya Ghar Muft Bijli Yojana is encouraging households to install rooftop solar systems with subsidies of up to Rs.78,000. Experts say most families can recover their investment within four to five years while enjoying reduced electricity bills for over two decades.

Government of India is pushing rooftop solar adoption through the PM Surya Ghar Muft Bijli Yojana, a scheme aimed at helping households reduce electricity bills and generate clean energy at home.

Launched in January 2024 by Prime Minister Narendra Modi, the scheme targets nearly one crore households across the country and promises support for rooftop solar systems capable of providing up to 300 units of free electricity every month.

One of the biggest questions among middle-class consumers is the actual installation cost and how long it takes to recover the investment.

Under the scheme, the central government offers subsidies based on the size of the rooftop solar system installed.

The subsidy structure is currently as follows:

• 1 kW system: Subsidy up to ₹30,000
• 2 kW system: Subsidy up to ₹60,000
• 3 kW system: Subsidy up to ₹78,000

For systems larger than 3 kW, the maximum subsidy remains capped at ₹78,000.

According to estimates shared in reports, rooftop solar installation costs vary depending on system size, roof conditions, location and equipment quality.

A 1 kW rooftop solar system may cost between ₹60,000 and ₹80,000 before subsidy. A 2 kW system can cost around ₹1.2 lakh to ₹1.6 lakh, while a 3 kW setup may cost approximately ₹1.8 lakh to ₹2.4 lakh.

After applying the subsidy, the effective cost drops significantly. For example, a 3 kW system costing around ₹1.8 lakh may effectively cost a homeowner nearly ₹1.08 lakh after availing the ₹78,000 subsidy.

The government says subsidy support can cover nearly 40 to 60 per cent of installation costs depending on the system size. Some states also offer additional subsidies. Uttar Pradesh, for example, provides an extra state subsidy of up to ₹30,000 in certain cases.

The subsidy amount is transferred directly to the beneficiary’s bank account after installation and official inspection.

Experts say the payback period mainly depends on electricity usage, local sunlight conditions and system size.

A typical 3 kW rooftop solar setup can generate nearly 250 to 300 electricity units every month. If a household consumes around 900 units monthly and pays an average tariff of ₹8 per unit, the electricity bill may reduce by nearly ₹2,200 every month after solar installation.

At this rate, the installation cost may be recovered within approximately 3.5 to 4.5 years. Smaller systems may recover costs slightly faster depending on consumption patterns and available subsidies.

Industry experts also point out that most rooftop solar systems are designed to last over 25 years. This means households may continue benefiting from significantly lower electricity bills long after recovering the initial investment.

Consumers can also export surplus electricity back to the power grid through net metering systems, further reducing power expenses.

Banks and financial institutions are also offering dedicated solar loans under the scheme. Experts advise consumers to carefully check subsidy eligibility, approved vendors, warranty terms, interest rates and maintenance requirements before installation.

Disclaimer: Solar installation costs, subsidies and savings may vary depending on location, electricity tariffs, state policies and vendor pricing. Consumers should verify details through official government portals and authorised installers before making financial decisions.