Solar ROI Calculator for India: How to Estimate Your Returns
Last updated at : Aug 13, 2026
A solar ROI calculator answers one question: for every rupee you put into a rooftop system, how much do you get back and how soon? You do not need fancy software to estimate it, just a few numbers from your electricity bill and the simple method below. This guide explains the inputs, the formula, and a worked example so you can sanity-check any quote you receive.
The inputs you need
A reliable estimate rests on five figures. Gather these before you start:
- Your average monthly bill (₹) or, better, your monthly units consumed (kWh).
- Your tariff (₹/unit), from your latest bill.
- Recommended system size (kW) for your consumption.
- System cost before subsidy.
- Subsidy you qualify for under the PM Surya Ghar scheme.
The method, step by step
Step 1: Estimate generation
Use the Indian benchmark: 1 kW generates about 4 to 4.5 units a day, or roughly 1,500 to 1,600 units a year. A 5 kW system therefore produces around 7,000 to 7,500 units annually.
Step 2: Calculate annual savings
Annual savings = Annual units generated x Your tariff
If a 5 kW system makes 7,200 units and your tariff is ₹9/unit, that is about ₹64,800 saved per year.
Step 3: Find your net cost
Net cost = System cost − Subsidy
A 5 kW system at about ₹3 lakh, minus a ₹78,000 subsidy, gives a net cost of roughly ₹2.2 lakh.
Step 4: Calculate payback and ROI
Payback (years) = Net cost ÷ Annual savings
Annual ROI (%) = (Annual savings ÷ Net cost) x 100
With ₹2.2 lakh net cost and ₹64,800 annual savings, payback is about 3.4 years and annual ROI is around 29 percent, a return very few conventional investments match.
Matching system size to your bill
To pick the system size input, this table is a useful starting point.
| Monthly bill | Recommended system | Approx. monthly saving |
|---|---|---|
| ₹3,000 – ₹5,000 | 2 – 3 kW | ₹2,500 – ₹4,000 |
| ₹5,000 – ₹10,000 | 5 kW | ₹4,000 – ₹8,000 |
| ₹10,000 – ₹20,000 | 8 – 10 kW | ₹8,000 – ₹16,000 |
A full worked example (5 kW system)
| Input / output | Value |
|---|---|
| System cost (before subsidy) | ₹3,00,000 |
| Subsidy | ₹78,000 |
| Net cost | ₹2,20,000 |
| Annual generation | ~7,200 units |
| Annual savings | ₹60,000 – ₹80,000 |
| Payback period | 3 – 5 years |
| Annual ROI | ~25 – 30% |
| 25-year total savings | ₹12 – 18 lakh |
The 25-year figure assumes savings grow modestly as grid tariffs rise, which they reliably do in India.
Things a quick calculator can't capture
An estimate is a starting point, not a guarantee. Real returns also depend on:
- Shading and orientation, which change actual generation.
- Your tariff slab, since solar removes the most expensive units first.
- Net metering terms set by your DISCOM.
- Panel quality and degradation, which affect output across 25 years.
For deeper reading on sizing and panel choices, see our solar blog. If financing affects your ROI maths, our solar loans page explains how savings can offset EMIs.
How Solnce helps
A formula gets you in the ballpark, but a site survey gets you the real number. At Solnce Energy we build your ROI estimate from your actual tariff, consumption, and roof conditions, then design a residential solar system to maximise that return. Get a free quote and we will run the full calculation for you, free of charge.
