Ember: Home BESS could cut India's solar exports by 90%

EXECUTIVE SUMMARY

Global energy think tank Ember has released an analysis indicating that integrating residential battery energy storage systems (BESS) with rooftop solar installations in India could reduce daytime electricity exports to the grid by 85–90%. Published on 22 October 2026, the study examines the financial viability of household battery storage under existing net metering regulations and evaluates potential incentives through the PM Surya Ghar: Muft Bijli Yojana.

India's rooftop solar capacity reached 30.7 GW by July 2026, nearly tripling since the scheme launched in 2024. This represented approximately 19% of the country's 165 GW installed solar capacity. Around half of the rooftop capacity was installed across more than five million households, where electricity consumption is generally lower during midday and higher during evening hours.

Ember modelled a typical household consuming 350 electricity units monthly, equipped with a 3 kW rooftop solar system. Following the INR 78,000 PM Surya Ghar subsidy, the solar installation costs INR 87,000 and achieves a payback period of 3.3 years.

Adding a 5 kWh battery could reduce daytime grid exports by 85–90%, shifting approximately 1,600–1,800 units of electricity annually from midday generation to evening consumption. However, the additional battery investment extends the overall system's payback period to over nine years.

Under existing net metering arrangements, households receive one-to-one credits for electricity exported during the day and consumed later. This reduces the financial incentive for battery adoption, while electricity distribution companies (DISCOMs) must credit daytime solar exports against potentially more expensive evening electricity procurement.

Ember estimates that providing a 50% subsidy on battery capital costs could reduce the solar-plus-storage payback period to 6.3 years. Extending battery incentives to five million households, equivalent to half of the scheme's current 10 million target, could create approximately 15–25 GWh of distributed energy storage capacity.

The analysis also evaluates potential regulatory changes. A 40% cap on banked electricity exports would result in a 6.5-year payback for subsidised hybrid systems. Alternatively, restricting the withdrawal of banked solar electricity during the 6–10 pm peak period and applying a 20% peak surcharge could reduce payback to 5.7 years, including subsidies.

Kerala, Maharashtra and Uttar Pradesh have begun exploring rooftop solar-plus-storage systems. The Central Electricity Authority has also suggested that DISCOMs could require two hours of storage alongside rooftop installations.

Ember recommends targeted battery subsidies to address upfront costs, support grid flexibility and prepare households for future demand response programmes.