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The Real and Indirect Factors Related to Solar Panel Price in India

The Real and Indirect Factors Related to Solar Panel Price in India

It is true that the solar panel price in India has been coming down and soon solar power is going to be cheaper than the power generated by thermal power plants. Here, it becomes important to understand some important aspects related to solar power and its impact on the overall cost of power supply so that you can make an informed decision before going solar.

Per Unit Cost is Low

One of the chief factors that accentuate the importance of rooftop solar panels in India is that the solar panels require very little maintenance. If they are maintained well, they offer a service life of over 20 years. So the entire cost of installation of the solar panels gets spread over the lifespan of 20 years which in turn makes it cost-effective.  Another advantage of installing solar panels in India is that it is located at an ideal geographical location and receives ample amount of tropical sunlight. So, the solar panels can work at their maximum capacity here and produce a good amount of power. Hence, the per unit cost of power that gets generated using solar energy is minimal. 

Helps in Indirect Savings

The solar panels can be installed on any type of roof. So, there is no need for you to vacate a land or invest in buying additional land to set up your solar panels. So, you can save this money of investing in land for installing solar panels. This helps to reduce the solar panel price in India . Also, these panels offer protection to your roof and allow you to save the cost of maintaining it on a timely basis. You can also use solar power for other purposes like heating water and supplying hot water or air to a building. This again helps you save money which you would have otherwise incurred to set up a separate unit for heating water or air in the building. 

Role of the Government

The government of India offers tax credits to the people who install solar panels at their rooftop tops. These benefits are given to encourage more people to use solar energy for power generation. This tax credit is applicable for both commercial and residential purposes. According to the Ministry of New and Renewable Energy, the government of India pays 30% of the total cost of installation of solar panels as a subsidy to the installer. This again helps the installer save some money. The government has also allowed custom and excise duty benefits in order to propagate the high growth of the sector. 

Here, the Solar Energy Corporation of India (SECI) has also played an important role in promoting solar energy by facilitating national and state-level tenders. 

The government of India has also authorized non-agricultural lands for solar power generation which further helps in employment generation. Since the cost of land is one of the major expenditures in setting up solar projects; the government came up with an MNRE solar park policy that issued guidelines for the state government to identify suitable pieces of land that are appropriate to set up solar parks or plants. 

Environmental Impact

Solar power plants can generate the maximum power during mid-day hours when the sunshine is the brightest. This solar energy helps to replace an equivalent amount of electrical energy from thermal power plants. Hence, solar energy helps to reduce the amount of coal burnt in the power plants, reduces the amount of ash produced by these power plants, controls the emission of carbon dioxide, and also curbs the requirements of coal mining. These are very important factors from the point of view of the environment and helps in deciding the real price of solar power. The country has realized that it is cheaper to build and operate solar farms than to control coal-fired power plants.  


India is a growing economy. So the consumption of power is only going to increase here. So, it is better that the country adopts alternate forms of energy in order to create a balance between economic growth and a sustainable environment. The solar panel price in India is marginal because the government here has taken steps to ensure consistent growth in this segment. The measures by the government have helped the solar industry to achieve economies of scale, hence, making the country the cheapest producer of solar power. Another point to be noted here is that India is a price-sensitive market. The availability of components like solar inverters, panels, etc is at competitive prices in India. Also, as solar tariffs drop below grid electricity tariffs, people shifted to solar energy. These further offer economies of solar, which in turn cause the prices of the components to drop even further. In a broad way, the solar panel price in India ranges between Rs 70,000 to Rs 1,20,000 per kW depending on the type of panel you choose.

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