Gross Metering

What is gross metering

Gross metering is a billing arrangement under which the entire solar PV generation from a customer’s plant is exported to the utility grid at a contracted feed-in tariff. The customer pays separately for grid consumption at the applicable retail tariff. Generation and consumption are decoupled and billed on two distinct meters.

Mechanically, gross metering uses two unidirectional energy meters at the service connection. One sits on the solar plant output and records only the energy sold to the DISCOM. The other sits on the consumption side and records only the energy bought from the DISCOM. The customer receives a monthly settlement equal to FIT times generation, and pays a monthly bill equal to retail tariff times consumption.

In Indian rooftop solar, gross metering is the secondary mechanism after net metering. As of 2026 it is used primarily for larger commercial and industrial customers in states where DISCOMs have lobbied for revenue protection, and for utility-scale rooftop solar where net metering caps make full export the only practical arrangement.

Gross metering explained simply

Picture two pipes between your house and the grid. One pipe carries solar power out at a wholesale price. The other pipe carries grid power in at a retail price. The two pipes do not interact. The DISCOM pays you for what flows out, and you pay the DISCOM for what flows in. No netting, no carry-forward, no balance.

See Gross Metering vs Net Metering, Which Should You Choose? for a worked payback comparison between the two mechanisms.

Gross metering exists because some DISCOMs cannot absorb the revenue loss from widespread net metering. Where the regulator has chosen gross, customers either accept the lower returns or stay off the rooftop programme.

Why gross metering matters

DISCOM revenue protection. Net metering nets retail demand to zero. Gross metering preserves the DISCOM’s full retail bill, paying separately for generation. This sustains DISCOM cash flow as solar penetration rises.

Larger system thresholds. Net metering caps in most states stop at 100 to 1000 kW. Above that limit, gross metering or open access is the only legal way to monetise rooftop solar.

Open access alternative. Gross metering is functionally a small-scale open access arrangement. The customer becomes a power producer with a DISCOM offtake contract.

Predictable revenue. The FIT is contractually fixed for the plant life, typically 25 years. The economics are easier to model than retail tariffs that change every year, and SurgePV’s financial modelling tools can run the FIT-based cash flow alongside a net-metering scenario for comparison.

Time-of-day independence. The FIT is flat. Solar generation profile does not need to match peak retail tariff slots.

How gross metering works

The flow from solar plant to monthly settlement is straightforward.

1. The solar PV system generates DC. The inverter converts it to AC.
2. The AC flows out through a dedicated generation meter, recording every kWh sent.
3. The output enters the DISCOM grid.
4. Separately, the customer’s loads draw power from the DISCOM grid through a consumption meter.
5. The DISCOM bills generation at FIT, consumption at retail tariff.
6. Monthly settlement is the difference: revenue from FIT minus cost of retail consumption.

Both meters are smart, AMI-enabled, and accuracy class 0.5S or better. The generation meter must be sealed and certified by the DISCOM.

Technical deep dive

Meter configuration

Two unidirectional meters in distinct physical locations:

• Generation meter installed at the inverter output, before any local load tap. Records solar generation only.
• Consumption meter installed at the service drop, recording grid import only.

Some DISCOMs use a single four-quadrant meter with separate registers for generation and consumption. This reduces hardware count but requires meter firmware that distinguishes the two streams.

Feed-in tariff structure

Actual rates depend on system size, customer category and the year of the tariff order. Always consult the current state SERC tariff order.

Customer categories

Most state regulations divide customers into residential, commercial, industrial, agricultural and group housing. Each category may have its own FIT and minimum or maximum system size for gross metering.

Contract term

Gross metering contracts run for the plant life, usually 25 years. The FIT is contractually fixed unless an escalation clause is built in.

Real-world applications

Large C&I rooftops. 500 kW to 5 MW rooftop or carport plants on factories, warehouses and IT campuses in states where net metering caps prevent full benefit — the same category of project Heaven Green Energy’s commercial solar installation teams size for gross-metered DISCOM contracts.

State-mandated systems. Some states require gross metering above specific thresholds, leaving the customer no net metering alternative.

Investor-owned rooftop assets. Third-party developers building rooftop plants on rented roofs use gross metering or PPAs to capture the entire generation revenue.

Group housing societies. In states without virtual net metering, common-area solar plants use gross metering to share revenue.

Distributed utility-scale. Sub-megawatt plants on land or rooftops in states like Telangana use gross metering as a simpler alternative to formal open access.

Advantages of gross metering

Higher system size cap than net metering. Useful for customers with large rooftops and small daytime load.

Predictable contracted revenue. The FIT is fixed for 25 years and easy to model financially.

Decouples generation from consumption. The customer can sell all generation regardless of on-site load pattern.

Eligible for accelerated depreciation, tax incentives and most other commercial solar incentives.

Simple billing logic. Two meters, two bills, no netting arithmetic.

Limitations

Lower per-unit revenue than net metering. FIT is below retail tariff in almost all states.

No self-consumption benefit. The customer cannot use solar to offset peak retail tariff hours.

Longer payback period. Typical 6 to 9 years against 4 to 6 for net metering.

Not subsidy-eligible. PM Surya Ghar and most state schemes target net metering only.

Contract risk. FIT contracts are 25 years. Regulatory changes can affect future tariff payouts.

Two meters and two billing cycles add administrative overhead.

Common problems

Generation meter inaccurate. A 0.5 percent error in the generation meter over 25 years is a meaningful revenue loss. Insist on class 0.5S meters with periodic accuracy audits.

Delayed FIT payments. DISCOMs in financially weak states delay solar FIT settlements by months. Build cash flow buffers.

FIT revision risk. Some state regulators revise FIT for new connections only, but customers worry about retrospective changes. Read the tariff order’s grandfather clause.

Confusion between generation meter and net meter. A bidirectional meter installed in error voids the gross metering contract.

Generation meter installed downstream of an internal load tap. Self-consumption goes uncounted, the customer is short-paid.

Plant inverter export limit set conservatively. Energy exceeding the limit is curtailed, reducing FIT revenue.

Best practices for gross metering

Negotiate the FIT and contract terms before installation, not after.

Specify class 0.5S meters in the contract. Confirm calibration and sealing at commissioning.

Insist on AMI integration. Manual readings are error-prone.

Build a payment schedule into the DISCOM contract with penalties for delay.

Audit the first six months of FIT settlements. Errors usually surface in the first three to six months.

Plan inverter capacity below the contracted DISCOM export limit to avoid curtailment.

Confirm the FIT carries through ownership change clauses, especially for investor-owned rooftop assets.

Document the single-line diagram with both meters clearly identified to avoid future audit disputes.

Comparison: gross vs net metering vs feed-in tariff

Indian market context

Tamil Nadu was the first major state to move large commercial customers from net metering to gross metering, in 2022. Andhra Pradesh followed for systems above specific thresholds. Other states retain net metering for residential while moving larger commercial and industrial customers toward gross.

The CERC Tariff Regulations and Forum of Regulators have published guidance on FIT setting methodology, which most state regulators follow with local variations.

PM Surya Ghar Muft Bijli Yojana is restricted to net-metered residential customers in most state implementations. Gross-metered installations do not receive central subsidy; see the PM Surya Ghar Muft Bijli Yojana Complete 2026 Guide for the full eligibility rules.

State DISCOMs and SERCs revise FIT every two to three years through a public consultation process. Existing contracts are usually grandfathered, but new connections enter the latest tariff order.

Standards and certifications

Common mistakes

Choosing gross metering when net metering is available and economically better. Lower returns for 25 years.

Installing only one meter to save cost. The DISCOM rejects the application.

Skipping the FIT escalation clause review. Customers assume escalation that is not in the contract.

Ignoring meter accuracy class. Class 1.0 meters accumulate 1 to 2 percent error over time, which is real money over 25 years.

Forgetting that gross metering disqualifies from PM Surya Ghar.

Not confirming the DISCOM payment timeline. Delayed settlements break the financial model.

Allowing the inverter to export above the contracted limit. Excess is unpaid or curtailed.

Key takeaways

Gross metering sells the entire solar generation to the DISCOM at a feed-in tariff while the customer pays separately for grid consumption. It is the right structure for large C&I rooftops, for state regulations that mandate it above thresholds, and for investor-owned plants. Returns are typically lower than net metering, payback is longer, and subsidy eligibility is limited. Meter accuracy, FIT contract terms and DISCOM payment discipline decide the long-term economics.

Further reading

For how Gross Metering plays out in real projects, these guides go deeper:

• Gross Metering vs Net Metering: Which to Choose?
• Net Metering in India, Complete 2026 Guide
• Best Solar Design Software Philippines: 2026 Guide
• Solar Subsidy in Delhi 2026, BSES + TPDDL

Sources

• Electricity Act 2003, Government of India.
• State SERC tariff orders on solar feed-in tariff for Tamil Nadu, Andhra Pradesh, Maharashtra, Karnataka, Uttar Pradesh, Kerala and other states.
• CERC Tariff Regulations and Forum of Regulators publications on distributed solar tariff design.
• CEA Smart Meter Regulations 2023, Central Electricity Authority of India.
• IS 16444, Indian Standard for AC static smart meters.
• MNRE Grid-Connected Rooftop Solar Programme guidelines, Ministry of New and Renewable Energy.
• NREL Technical Report TP-6A20-72472, Net Metering and Distributed Generation Tariff Design.
• IEA PVPS Task 17 Report on PV in distributed generation markets.
• IRENA Renewable Energy Auctions: Status and Trends Beyond Price.