Commercial Solar System Sizing in India

Commercial solar projects in India, factories, warehouses, schools, hospitals, malls, are the highest-revenue segment for most EPC owners, and industrial rooftop installations in particular carry the biggest tickets. They are also the segment where a sizing mistake costs the most: an undersized system leaves savings on the table and a disappointed client; an oversized system runs into your state's net metering cap and stranded capital. Getting commercial sizing right is a core EPC competency, and it starts with a structured process, not a back-of-envelope guess.

This guide walks through the complete commercial solar sizing methodology used by professional EPC companies in India: from reading the electricity bill, through load analysis, roof area calculation, inverter ratio, string design, and the battery-vs-grid-tie decision, all the way to a worked example with a 100 kW factory. For the selling side, see our guide on how to sell solar to factories.

Why commercial sizing is different from residential

Residential solar sizing in India is relatively straightforward: 3 kW, 5 kW, or 10 kW systems on RCC terraces with standard roof configurations. The PM Surya Ghar framework even provides a rough reference, subsidy slabs start at 1 kW and the most common size is 3 kW for a 2–4 BHK home. If you need the household version of this process first, our residential solar sizing guide walks through the same bill-to-kW math for homes.

Commercial sizing has none of these simplifications. A 10,000 sq ft warehouse may have 200 kW of connected load but actually consume only 30,000 kWh/month because machinery runs in two shifts. A hospital may have 50 kW of connected load but a near-100% load factor due to 24/7 critical equipment. A school may have high connected load but generate most consumption during daytime hours, which aligns perfectly with solar generation.

Additionally, commercial connections in India face regulatory complexity: state-specific net metering caps, captive vs. third-party ownership structures, and depreciation eligibility. Commercial and industrial consumers are a large rooftop opportunity, but we have not cited a consumption share here because we could not source one. Missing any of the regulatory factors in your sizing exercise leads to a proposal that cannot be executed or one that fails to deliver promised returns.

Step 1, Read the electricity bill correctly

The electricity bill is your primary data source for commercial sizing. You need three numbers:

Monthly consumption in kWh, found in the "Units consumed" or "Energy charges" section. For commercial customers, use the average over the last 12 months, seasonal variation is significant (summer air-conditioning loads may be 2–3× winter loads). If the customer only has the last 3 months' bills, ask for the previous year's bills or use the billing software if DISCOM provides online history.

Sanctioned load in kW, the contracted demand with the DISCOM. This is the upper cap for solar system size in many states, often expressed as: system size ≤ sanctioned load. If the sanctioned load is 50 kW and the client wants 100 kW of solar, they may need to upgrade their sanctioned load, which involves a separate DISCOM application process.

Tariff rate per unit (₹/kWh), the commercial tariff determines the financial case for solar. Tariffs vary by state and category, so use the rate on the customer's own bill. HT consumers usually pay lower per-unit rates but have demand charges that change the ROI calculation significantly, so check your state regulator's current tariff order.

Step 2, Calculate system size from consumption

The core sizing formula for commercial solar in India:

System size (kW) = Monthly consumption (kWh) ÷ Monthly generation factor

The monthly generation factor is how many kWh a 1 kW solar system generates in your geography per month, averaged over the year. This ranges from 110–130 kWh/kW/month across most Indian locations:

The table gives rounded planning values, not a sourced dataset. For a project, check Solargis India irradiance data and the MNRE resource data and run a site simulation. The values assume a 10–15% system efficiency derating for inverter losses, wiring losses, soiling, and temperature. The solar payback period by state guide contains city-level generation benchmarks used in ROI calculations.

Step 3, Validate against roof area

Roof area is the second constraint on commercial system size. The rule of thumb is:

Roof area required = System size (kW) × 10–12 sq m/kW

This assumes standard 400–450 Wp monocrystalline panels (roughly 2.0–2.2 sq m each) with a 20–25% inter-row spacing allowance to prevent shadow from the row in front during low-angle winter sun.

Step 4, Check the net metering cap

India has no national 25 kW net metering cap. State rules set the cap. For example, Telangana allows net metering up to 500 kWp (TGERC Regulation 1 of 2025), Maharashtra up to 5 MW or the contract demand or sanctioned load, whichever is lower (MERC Statement of Reasons, 16 Nov 2023), and where a state regulation is silent the central Rights of Consumers Rules allow 500 kW or the sanctioned load, whichever is lower (rule 11(4)). Where a system exceeds the state cap, it either exports under gross metering or shifts to captive consumption (zero export) design. The cap situation by connection type:

• LT Commercial: The cap is set by your state regulation (see above), and some states put commercial consumers on net feed-in rather than net metering (Tamil Nadu does for other low-tension categories, up to 999 kW). Check current regulations, they change, and see our DISCOM solar approval process guide for the phase-by-phase application timeline.
• HT Commercial (11 kV and above): Net metering or net billing at larger scales; regulations vary significantly by state and DISCOM. In some states, HT consumers must use gross metering or captive models above a state-set ceiling (for example gross metering up to 1 MWp in Telangana).
• Captive model: For systems above the state's net metering cap, all solar generation is consumed on-site (no export). This requires careful load analysis to ensure the system does not generate more than the building consumes, otherwise generation is wasted.

For more on how the cap works state by state, read our guide on net metering 25kW cap in India (the 25 kW figure is not a national rule).

Commercial customers who own the asset (factory owners, warehouse owners, hospital management) should also evaluate depreciation: 40% of written down value for solar power generating systems under section 33 of the Income-tax Act, 2025, with the rate in Appendix I of the Income-tax Rules, 2026 (it was section 32 of the 1961 Act). The allowance is halved if the plant is put to use for less than 180 days in the tax year (section 33(4)). Read our detailed analysis in the depreciation for solar guide, and confirm the numbers with the customer's CA.

Step 5, Inverter sizing and DC:AC ratio

Commercial string inverters are sized using a DC:AC ratio, also called the inverter loading ratio. The formula:

DC:AC ratio = Total panel capacity (kWp DC) ÷ Inverter rated capacity (kW AC)

For Indian commercial installations, the standard DC:AC ratio is 1.1–1.3. This means you can connect 110–130 kWp of panels to a 100 kW inverter. The rationale: solar panels rarely produce 100% of rated output in real Indian conditions (temperature derating, dust, spectral mismatch), so the inverter is sized to the realistic output range, not the peak nameplate DC figure. Oversizing panels relative to inverter capacity also improves generation in low-irradiance morning and evening hours when panels are below inverter clipping threshold.

For commercial systems above 30 kW, use multiple inverters of 25–30 kW each (the common commercial string inverter size range from Growatt, Solis, and others) rather than a single large inverter. Multiple inverters provide redundancy, if one fails, the others continue producing. This is critical for commercial customers where generation downtime translates directly to lost savings.

Step 6, String design

String design determines how many panels are connected in series per string, and how many strings connect to each inverter MPPT input. The key constraints are:

Voc check: Maximum open-circuit voltage (Voc) of the string at minimum expected temperature must not exceed the inverter's maximum input voltage. For Indian conditions, minimum temperature is typically 5–10°C in northern India, 10–15°C in central India. Panel Voc increases as temperature drops, calculate worst-case: Voc_string = Panel_Voc × (1 + Voc_TC × (T_min − 25°C)) × N_panels_per_string.

Vmp operating range: The string voltage at maximum power point (Vmp) must fall within the inverter's MPPT voltage window across the full temperature range in India (from 5°C minimum to 45°C+ in peak summer).

String count per MPPT: Each MPPT input on a commercial inverter accepts a defined number of strings in parallel. Confirm from the inverter datasheet. Our string sizing glossary entry covers the Voc/Vmp temperature-correction formulas in more depth, and inverter maker QBits Energy has a useful India-specific breakdown of string sizing and overcurrent protection rules for commercial arrays.

For a 100 kW commercial system in Gujarat using 440 Wp panels (Voc 38V, Vmp 31V, Isc 12A) with a 100 kW inverter (MPPT range 200–850V DC, max input 1000V DC):

• Series string of 22 panels: Vmp = 22 × 31V = 682V (within MPPT range); Voc at 5°C = 22 × 38 × 1.025 = 856V (below 1000V limit)
• 22-panel strings are valid for this configuration

This level of design detail should be documented in every commercial proposal before submission. An EPC that shows string design calculations builds far more credibility with commercial customers than one that just names the inverter brand and capacity. This is also important for the commissioning process, see our solar commissioning process guide for what documentation is required at DISCOM inspection.

Stats, commercial solar market in India

Step 7, Battery vs grid-tie decision for commercial

The majority of commercial solar installations in India are grid-tied without batteries. The financial logic is clear: at commercial scale, battery storage is expensive per kWh, and the payback on the battery portion is long unless the customer has a specific need.

When to recommend battery for commercial:

• Site has significant grid outages during business hours (tier-2 industrial estates with 4+ hours daily load shedding)
• Business has critical loads that cannot tolerate outages (hospitals, cold storage, data centres)
• The DISCOM grid tariff has a high demand charge structure, batteries can reduce peak demand charges significantly, improving ROI

When battery is NOT needed for commercial:

• Grid is reliable (metro urban areas)
• Business operates daytime hours (office building, school), generation and consumption align well
• The additional capital cost would push payback beyond the customer's acceptable threshold

For commercial HT customers with demand charges, the battery sizing logic is different from residential, you are sizing to flatten the demand curve, not just to provide backup. This is a specialised design that requires load profile data (15-minute interval data from the smart meter) to execute properly. The general rule: if demand charges exceed 30% of the monthly bill, battery storage deserves serious analysis.

Worked example, 100 kW factory in Pune

Let's walk through the complete sizing exercise for a real-world scenario: a manufacturing factory in Pune, Maharashtra. For the fuller tax and payback math behind the ROI step below, see our commercial solar ROI calculation guide.

The client brief (an illustrative case, with assumed figures): 20,000 sq ft factory building. Monthly electricity bill: ₹1,20,000. One shift operation (8 AM–6 PM). Wants to maximise solar savings. LT commercial connection, sanctioned load: 150 kW.

1. 1

   Read the bill

   Monthly bill ₹1,20,000 at blended LT commercial tariff of ₹7/kWh = 17,143 kWh/month consumed. 12-month average used; summer peak months hit 20,000 kWh, winter low months 14,000 kWh. One-shift operation means 90%+ of consumption falls between 8 AM and 7 PM, excellent solar overlap.

2. 2

   Calculate system size

   Pune generation factor = 118 kWh/kW/month. System size = 17,143 ÷ 118 = 145 kW. Check the state cap first: MERC allows net metering up to 5 MW or the contract demand or sanctioned load, whichever is lower, so the 150 kW sanctioned load is the limit here, not a 25 kW cap. Since this is a single-shift factory consuming most energy during solar hours, sizing for 90–95% self-consumption is a sensible approach. Captive target: 17,143 × 0.90 = 15,430 kWh/month. System size = 15,430 ÷ 118 = 130 kW. Round to 100 kW given roof constraint (see next step).

3. 3

   Validate roof area

   20,000 sq ft ≈ 1,858 sq m. Usable area after setbacks, AC units, and water tanks = approximately 1,250 sq m (67% utilisation). At 12 sq m/kW (conservative inter-row spacing): 1,250 ÷ 12 = 104 kW. At 10 sq m/kW: 1,250 ÷ 10 = 125 kW. A site visit confirmed 1,100 sq m usable, which supports about 100 kW on low-tilt mounting. Final design: 100 kW DC (245 units × 415 Wp panels) on low-tilt mounting (5–10 degree) to maximise density.

4. 4

   Inverter configuration

   DC:AC ratio 1.15: 100 kWp DC ÷ 1.15 = 87 kW AC inverter capacity. Use 4 × 25 kW string inverters (100 kW AC total), this gives DC:AC ratio of 1.0 with room for future panel additions. Alternatively: 3 × 30 kW string inverters = 90 kW AC, DC:AC ratio = 1.11. Both are valid; 4 × 25 kW offers better redundancy for a factory setting.

5. 5

   ROI calculation

   Annual generation: 100 kW × 118 kWh/kW/month × 12 = 1,41,600 kWh/year. Annual savings: 1,41,600 × ₹7 = ₹9,91,200 (~₹9.9 lakh/year). System cost (100 kW commercial, installed): assumed ₹50–60 lakh (illustrative, use supplier quotes). Simple payback: ₹55 lakh ÷ ₹9.9 lakh = 5.6 years. With depreciation at 40% WDV (assumed 30% tax rate, full first year): effective Year 1 tax saving of ₹6.6 lakh (40% × ₹55 lakh × 30%), bringing effective net cost to ₹48.4 lakh. Adjusted payback: 4.9 years. Simple 25-year savings: about ₹2.5 crore at today's tariff, before escalation and module degradation. Confirm tax figures with the owner's CA.

Pros and cons, commercial sizing approaches

Shadow analysis for commercial rooftops

Shadow analysis is non-negotiable for commercial systems above 25 kW. Unlike residential installations where a quick site visit can identify obvious obstructions, commercial rooftops often have HVAC units, ventilation structures, smoke exhaust stacks, and overhead cable trays that create complex shading patterns. Heaven Designs has a useful walkthrough on how to run shadow analysis on a rooftop if you want the engineering-side detail on obstruction mapping and near-shading objects.

The standard tools used by professional EPCs:

• PVsyst, the industry standard simulation software used for bankable generation reports for large commercial and industrial projects. PVsyst reports are often asked for by banks and financiers for project loans.
• HelioScope (cloud-based), faster to use than PVsyst for 50–500 kW systems; used by many commercial EPCs for initial proposals before committing to full PVsyst simulation.
• Google Earth + shade analysis plugins, adequate for initial desktop assessment but should not be used as the sole basis for a ₹50 lakh commercial proposal.

The shadow analysis determines the optimal panel layout, tilt angle, and row spacing to minimise inter-row shading while maximising panel density. For flat RCC rooftops (most Indian commercial buildings), the optimal tilt angle is typically 10–15 degrees for captive commercial designs (lower tilt = more panels per square metre; slightly less generation per panel but more total panels in the space). For south-oriented tilt optimisation, use tilt = latitude − 5° as the starting point.

How Quickest Solar CRM fits a commercial workflow

When an illustrative EPC team receives a commercial inquiry, a factory owner wanting to know the cost and ROI for solar, the traditional workflow is: collect the electricity bill, do the sizing manually in Excel, build a proposal in Word, send a PDF. That is a lot of engineering and proposal writing before a single site visit.

• Proposal Generator, build the sizing in your own sheet using the method above, then put the items, product photos, price list margin and terms into a branded proposal PDF from your template and share it on WhatsApp.
• Lead Capture, add and filter leads, use labels to tag commercial leads separately from residential, and log the monthly bill value as an activity on the lead so you know which commercial inquiries are worth prioritising for site visits.
• Pipeline Management, commercial projects have longer sales cycles and more stakeholders (finance manager, promoter, and sometimes a bank if project financing is involved). Set your own stages (inquiry, site survey, proposal sent, negotiation, PO received) and follow-up reminders, with team members assigned, so large commercial deals do not slip through the cracks.

For the broader question of when a solar CRM transforms your commercial quoting workflow, read when to buy a solar CRM. If you are scaling your EPC business beyond residential into commercial, the solar EPC guide covers the business model transitions involved. Start your free Quickest Solar CRM account and send your first commercial proposal today.

Frequently asked questions

How do I size a solar system for a commercial customer from just the electricity bill?

Divide the monthly kWh consumption by the monthly generation factor for your city (use 110 for lower-irradiance states like West Bengal; 120 for Gujarat, Maharashtra; 125 for Rajasthan). The result is the approximate system size in kW. Validate this against available roof area (10–12 sq m/kW) and your state's net metering cap (set by state regulation, not a national 25 kW figure). For a captive design above the cap, size to 80–90% of the daytime consumption to avoid export waste.

What is the rule of thumb for roof area required for commercial solar in India?

Plan for 10–12 square metres of usable roof area per kW of solar capacity. This includes inter-row spacing to prevent winter shading between panel rows. For a 100 kW system, you need 1,000–1,200 sq m of usable roof area. The usable area on a typical commercial building is 60–70% of the gross rooftop footprint, account for setbacks from parapets, HVAC equipment, water tanks, and staircase structures.

Should a commercial factory choose net metering or captive (zero-export) solar?

Within your state's net metering cap, net metering is generally better: surplus power earns credits and the system can be sized to full consumption without waste. Above the cap (for example 500 kWp in Telangana), you move to gross metering or a captive model, and some states put commercial consumers on net feed-in instead. Single-shift factories with 90%+ daytime consumption are ideal captive solar customers, nearly all generation is self-consumed. Multi-shift or 24/7 operations need careful analysis because nighttime consumption cannot be solar-served without battery storage.

What DC:AC ratio should I use for a commercial solar system in India?

Use a DC:AC ratio of 1.1–1.3 for commercial string inverters in India. Start at 1.15 as your default: it captures the benefit of panel overclocking in low-irradiance morning and evening hours without causing significant midday clipping. For high-irradiance locations (Rajasthan, Gujarat), stay at 1.1–1.15 to minimise clipping. For moderate-irradiance locations (coastal Maharashtra, Bengal), 1.2–1.25 is acceptable.

Is accelerated depreciation available for all commercial solar installations?

Yes for the owner of the asset. Under section 33 of the Income-tax Act, 2025 (section 32 of the 1961 Act before 1 April 2026), solar power generating systems are depreciated at 40% of written down value (Income-tax Rules, 2026, Appendix I), halved if the plant is put to use for less than 180 days in the year. It is available to a business that owns the asset, not to the customer of a third-party owned system. For a profitable business at an assumed 30% tax rate, a full first-year allowance saves tax of about 12% of the system cost (40% × 30%) in Year 1, so confirm the figures with the owner's CA. Read the full analysis in our depreciation guide.

How long does a commercial solar project take from inquiry to commissioning?

No single figure is official. Equipment procurement and installation depend on your supplier and crew, so plan those from your own records. The DISCOM steps have clocks: under the central Rights of Consumers Rules (amended 22 Feb 2024) feasibility is due in 15 days above 10 kW (presumed feasible if missed), and agreement, meter and commissioning are due within 15 days of your installation certificate; your state regulation may add its own steps, and some states require a Chief Electrical Inspector certificate above a notified capacity. See our solar commissioning process guide for the stage-by-stage breakdown, and the payback period guide for state-level generation context for your ROI presentations.

What is the minimum roof area needed for a 100 kW commercial solar system?

A 100 kW system requires approximately 1,000–1,200 sq m of usable roof area using standard 400–450 Wp panels at low tilt (5–10 degrees). If the roof is smaller, consider higher-efficiency panels (500–550 Wp bifacial) which need less area per kW but cost 15–20% more per panel. For a 12,000 sq ft (1,115 sq m) factory building, plan for 60–75 kW as a realistic cap when accounting for setbacks and rooftop equipment, not 100 kW. Always verify usable area on site before quoting.

Does PM Surya Ghar scheme apply to commercial solar projects?

PM Surya Ghar Muft Bijli Yojana is a residential rooftop scheme, it applies to domestic consumers with residential electricity connections. Commercial consumers (LT commercial, HT industrial) are not eligible for PM Surya Ghar central subsidy: MNRE's guidelines say no CFA is provided to non-residential segments (clause 5(d)). Commercial benefits come mainly from depreciation under the Income-tax Act, 2025, and any state-level programme you can confirm. For the detailed comparison of which scheme applies to which consumer type, see our PM Surya Ghar vs CFA scheme guide.