Business7 min read
Solar for Small Businesses: What the Numbers Look Like
No subsidy, better economics. Why a shop, clinic or guest house often gets a shorter payback than the house next door.
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Key takeaways
- PM Surya Ghar does not cover commercial connections — but commercial tariffs are higher, so each displaced unit is worth more.
- Businesses can claim accelerated depreciation on solar assets, improving the post-tax position for a profit-making entity.
- Self-consumption is the main driver of return: a unit used on site avoids the full retail tariff; an exported unit is credited at less.
- Typical small-business systems run 10 kW to 25 kW, sized from twelve months of bills rather than from roof area.
- Businesses with evening-weighted load are weaker candidates and should size to the daytime baseline instead.
Small business owners often assume solar is a worse deal for them than for households, because the headline subsidy does not apply. In practice the opposite is usually true.
Commercial tariffs are higher than domestic ones, business consumption tends to align with generation hours, and there is a tax treatment households cannot access. Together those three things generally outperform the ₹78,000 the residential scheme offers.
Why no subsidy is not a problem
A household displaces units worth around ₹7. A small business on a commercial tariff often displaces units worth ₹9 to ₹10 or more depending on category and demand charges. Across a 20 kW system generating 32,000 units a year, that difference is worth roughly ₹64,000 to ₹96,000 a year — which dwarfs a one-time ₹78,000 subsidy within the first two years.
Add accelerated depreciation, available to a profit-making entity on solar assets, and the post-tax position improves further. Your accountant should model that alongside our generation figures, because the benefit depends on your tax position rather than on the plant.
Which businesses are genuinely good candidates
The test is simple: does your consumption happen while the sun is up? Clinics, diagnostic centres, showrooms, offices, schools, coaching institutes, guest houses, cold storages and daytime workshops all consume through generation hours and self-consume most of what they produce.
Restaurants with evening-weighted trade, banquet halls used mainly at night, and businesses that operate a single evening shift are weaker candidates. They are not impossible — but they should size to the daytime baseline rather than to total consumption, and we will say so rather than selling capacity that will export at a discount.
- Strong fit — clinics, showrooms, offices, schools, guest houses, cold storages, daytime workshops
- Moderate fit — hotels with variable occupancy, mixed-hours retail
- Weak fit — evening-only restaurants, banquet halls, night-shift operations
What size, and what it costs
Most small businesses land between 10 kW and 25 kW. A 15 kW system costs an indicative ₹7,20,000 to ₹8,80,000, generates about 24,000 units a year and saves roughly ₹2,16,000 annually at a ₹9 commercial tariff — a payback of three and a half to four and a half years.
A 25 kW system costs an indicative ₹11,00,000 to ₹14,00,000, generates about 40,000 units and saves roughly ₹3,60,000 a year on the same assumptions. Per kilowatt, larger is cheaper — but only capacity your load actually absorbs earns the full return.
What a proper commercial proposal contains
- A generation model with its assumptions stated, not a single optimistic number
- A self-consumption analysis run against your own twelve months of bills
- An assessment of the existing LT panel, sanctioned load and available headroom
- A structural survey of the roof, with any reinforcement priced before contract
- A clear scope boundary — including what is excluded
- A commissioning and documentation plan with measured test results
Frequently asked questions
Can a small business claim the solar subsidy?
No. PM Surya Ghar covers residential connections only. Businesses instead benefit from a higher tariff to displace and from accelerated depreciation on the asset, which together usually produce a better return than the residential subsidy delivers — often within the first two years.
What size solar system does a small business need?
Most land between 10 kW and 25 kW, but the figure should come from twelve months of bills and your load pattern rather than from roof area. What matters is how much of the generation you consume on site: a self-consumed unit avoids the full retail tariff, while an exported unit is credited at less.
Is solar worth it for a shop or restaurant that operates in the evening?
It can be, but the sizing changes. A business with evening-weighted load exports most of its daytime generation at a lower credited value, which lengthens payback. The right approach is to size to your daytime baseline rather than to total consumption — a smaller system with a shorter payback beats a large one that exports half its output.
Why clients choose Dvaitam Solar
Engineering-first approach
Structural survey, seasonal shadow analysis and yield modelling before a capacity is quoted — never a catalogue picked off a price list.
Premium Tier-1 equipment
ALMM-listed modules and BIS-certified balance of system, specified against the engineering and not substituted after contract.
PM Surya Ghar assistance
Portal registration, DISCOM feasibility, net metering and inspection filed and chased until the subsidy is credited.
End-to-end EPC execution
Design, supply, civil, electrical, testing and commissioning under one scope and one accountable team.
Professional installation
Method statements, quality records captured as work proceeds, and measured commissioning tests rather than a switch-on.
Long-term support
Monitoring configured at handover, a documented O&M pack and a performance baseline you can hold the plant to in year five.
Next steps
Related reading
- BusinessSolar Power for Factories: Engineering, Not Just PanelsAt industrial scale the array is the easy part. Structure, connection design and power quality decide whether the plant performs.
- Cost & ROIHow to Calculate Solar ROI Properly (and Spot a Padded Projection)The four-line calculation that gives you a real payback figure, and the five assumptions vendors quietly adjust to improve it.
- BusinessLocal vs National Solar EPC in Rajasthan: Who Actually Wins?National brands bring balance-sheet strength. Local EPCs bring DISCOM knowledge and a service van. Here is how to judge which matters more for your project.
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