600 kW of rooftop solar used to qualify for net metering in full. Now only 500 kW of it does; the remaining 100 kW gets pushed onto gross metering, billed at a different rate.
That gap changes the payback math for the whole project.
This isn’t an isolated case. Andhra Pradesh has tightened its net metering cap too, and the two states’ rules now look a lot more alike than they used to. But they’re not identical, and the differences still show up in your project cost. Worth knowing the current limits before you size a system, not after.
Quick refresher on how this works: Net metering lets a rooftop solar owner offset what they pull from the grid against what they feed back into it. At the end of the billing cycle, they settle up on the difference. TSERC writes the rules for Telangana. APERC does it for Andhra Pradesh.
How Net Metering Actually Works
A bi-directional meter sits at the interconnection point between the solar system and the grid. It records two numbers: units imported from the DISCOM and units exported to it. At the end of the billing cycle, the DISCOM nets these off. Generate more than you use, and the surplus carries forward or gets paid out at a rate the commission sets, not necessarily the retail tariff. Draw more than you generate, and you pay for the shortfall at your normal slab rate.
Gross metering works differently. Every unit generated is sold to the DISCOM at a fixed feed-in tariff. Every unit consumed is bought separately, with no offsetting. It suits large installations that export most of their output. Net metering suits sites that consume most of what they generate on-site: a factory running through the day, a hospital, or an apartment complex.
Telangana’s Current Net Metering Rule
For a long stretch, Telangana allowed net metering for systems between 1 kWp and 1 MWp. That ceiling has come down. Under TSERC’s net metering regulation, capacity is capped at 500 kWp per eligible consumer. Anything larger moves to gross metering, which is still permitted up to 1 MWp.
The same regulation also spells out two arrangements that weren’t clearly available before. Group net metering lets one consumer offset generation across multiple connections they own. Virtual net metering is aimed at housing societies and residential colonies sharing output from a common rooftop installation. Both are currently capped below 100 kWp.
Sanctioned-load limits stay the same as before. Residential and government consumers can size a system up to 100% of their sanctioned load. Industrial, commercial, and other consumers are capped at 80%. Approvals run distribution-transformer-wise on a first-come, first-served basis, through TGSPDCL in the south or TGNPDCL in the north. Systems above 75 kW need a Chief Electrical Inspector to Government (CEIG) certificate before commissioning; smaller systems can be self-certified by the consumer.
One thing worth flagging if you’re mid-application: TGSPDCL’s own public documentation still references the older 1 MW ceiling in places. Confirm your project’s category directly with the DISCOM before finalizing system size, especially if you’re anywhere near the 500 kWp mark.
Andhra Pradesh’s Rule, and How APERC Has Been Applying It
APERC set the net metering cap at 500 kWp and the gross metering cap at 5,000 kWp, well ahead of Telangana. Since that cap took effect, the commission has mostly been settling disputes over how it applies, rather than rewriting it.
APERC has clarified how the cap treats older projects. Existing rooftop systems between 500 kWp and 1,000 kWp, commissioned before the cap took effect, keep their original net or gross metering terms. The question came from APEPDCL, which asked whether the cap applied retroactively. It doesn’t, for projects already approved or under construction with an approved feasibility report at the time.
APERC has also directed every DISCOM in the state to settle rooftop solar bills monthly. That followed complaints that some consumers weren’t being credited for surplus export on a regular cycle. Payment for exported energy now has to go through electronic transfer, not adjustment or delay.
APERC has issued practice directions on behind-the-meter (BTM) rooftop systems too. These are systems where power is generated and used entirely on-site, with nothing exported. DISCOMs can no longer levy open-access surcharges on that electricity, though regulated capacity charges still apply.
A separate proposal covers virtual and group net metering, similar in spirit to what Telangana already has. It has been out for public comment and is still working through the process. See how Hydromo supports apartments and commercial buildings applying for solar subsidies and shared metering for what’s currently possible for housing societies.
For residential systems, the feed-in tariff on exported surplus typically falls between ₹2.50 and ₹3.50 per unit. AP also uses annual banking. Monthly surplus carries forward and gets settled at year-end at the export rate, separate from the monthly billing cycle APERC has mandated.
Telangana vs. Andhra Pradesh, Side by Side
Both states now cap net metering at or below 500 kWp. Both exempt most residential systems from surcharges and require a bi-directional meter at the interconnection point. Where they differ is in the details that actually affect a project.
Telangana’s cap is the newer of the two. Projects sanctioned earlier under the old 1 MW rule may sit in a transition category, worth checking directly with TGSPDCL or TGNPDCL. Andhra Pradesh’s grandfathering rule is already settled and documented, which gives more certainty to anyone holding an older installation above 500 kWp.
Andhra Pradesh has gone further on billing enforcement, with a specific monthly-settlement directive and BTM surcharge relief that Telangana hasn’t matched in public communication. Telangana, for its part, has been more explicit about group and virtual net metering caps in its regulation text.
Neither state’s rules should be treated as permanent. Both commissions have amended rooftop solar regulations more than once already. AP’s virtual net metering proposal is still working through the comment process.
What This Means for Sizing a System
For a residential consumer, not much changes. Net metering up to 100% of sanctioned load is available in both states. The central PM Surya Ghar Muft Bijli Yojana subsidy adds up to ₹78,000 for a 3 kW residential solar system on top of that. It’s part of a national push to get rooftop solar onto a large share of Indian homes.
For a commercial or industrial consumer sizing anything near or above 500 kWp, the math is different from what it used to be. Take that 600 kW load in Nalgonda again. Under the old Telangana rule, the whole system would net off against retail consumption. Under the current rule, 500 kW nets off. The remaining 100 kW gets billed as gross metering, at the feed-in tariff rather than the retail rate. That’s not a reason to avoid a larger system. It’s a reason to model the payback correctly: use the gross-metering rate for the portion above the cap, not the retail rate for the whole system. See how this plays out in practice in Hydromo’s guide to commercial rooftop ROI in Andhra Pradesh.
Hydromo designs and installs rooftop and commercial solar systems across Hyderabad, Telangana, and Andhra Pradesh, including in Vijayawada. That includes the net metering application and DISCOM liaison, and sizing decisions that account for these caps before a system goes on the roof.
Try the free Hydromo Solar Calculator to estimate system size and savings, or request a free site assessment. Hydromo handles the DISCOM application and net metering paperwork alongside the installation.
Frequently Asked Questions
What is the maximum size for net metering in Telangana?
500 kWp per eligible consumer, under TSERC’s net metering regulation. Larger systems, up to 1 MWp, fall under gross metering instead.
What is the maximum size for net metering in Andhra Pradesh?
500 kWp under APERC’s rooftop solar regulation. Gross metering is available up to 5,000 kWp. Projects above 500 kWp commissioned before the cap took effect may still hold their original net metering terms under APERC’s grandfathering clarification.
Can a residential consumer install a system larger than their sanctioned load?
No. Residential and government consumers can install up to 100% of their sanctioned load; industrial, commercial, and other consumers are capped at 80%.
Who installs the net meter, and who pays for it?
The DISCOM is responsible for providing the net meter, though a consumer can opt to procure a tested meter at their own cost in some cases. Costs and processes are confirmed at the application stage with TGSPDCL, TGNPDCL, or the relevant AP DISCOM.
How often is surplus solar power settled?
Telangana and Andhra Pradesh both work on a monthly settlement cycle for billing, per APERC’s directive in AP’s case. AP additionally uses annual banking for surplus units, carrying them forward to a year-end settlement at the notified export rate.
Does net metering exempt a consumer from all charges?
Largely, for systems within the sanctioned-load caps. Most transmission, wheeling, and cross-subsidy surcharges don’t apply to captive or within-limit rooftop solar. Andhra Pradesh’s practice direction on behind-the-meter systems specifically removed open-access surcharges on power consumed entirely behind the meter.