When you install rooftop solar panels, the government allows you to connect to the electricity grid in two main ways: net metering or net billing.

In net metering, your electricity bill is calculated based on the difference between how much power you use from the grid and how much extra solar power you send back to it. So if you produce more power than you use, your bill goes down or can even become zero.

In net billing, the extra solar power you send to the grid is sold at a fixed rate, which is usually lower than the rate you pay for electricity. You still pay for all the electricity you use from the grid, and you get a separate credit for the power you export.

Because of this, net metering usually saves you more money than net billing—especially if you’re a homeowner.

If you want to apply for residential rooftop solar project and live anywhere in India, you are entitled for a central govt subsidy of Rs 78,000/- if you are planning a project of upto 3kW or more. However, in case your state gives you additional susbsidy, you can get more. For example, a UP resident for a 3kW system can get Rs 78,000/- from MNRE and Rs 30,000/- from UPNEDA (UP govt). So, in total you will get Rs 1,08,000/- for a 3kW system or a system more than 3kW. It is because there is a ceiling for connections after 3kW.