1 MW Solar Power Plant in India: Cost, Specifications, and Investment Insights

With India aiming to become a global leader in renewable energy, solar power continues to drive transformation across industries. Among various capacities, the 1 megawatt (MW) solar power plant has emerged as a preferred choice for commercial, industrial, and institutional setups looking to reduce electricity bills and carbon footprints. But how much does a 1MW solar power plant cost? How much land is required? What’s the ROI?

This article explores all the essential aspects—costs, generation capacity, land requirements, subsidies, and more—to help you understand whether a 1 MW solar plant is the right choice for you.

What is a 1 MW Solar Power Plant?

A 1MW solar power plant is a solar photovoltaic system capable of generating 1 megawatt (1,000 kilowatts) of electricity under ideal conditions. On average, such a plant can produce around 4,000 units (kWh) of electricity per day, depending on location, weather conditions, and technology used.

This is sufficient to power:

• A medium-sized industrial plant

• A college or school campus

• A large commercial complex

• Or around 300–400 average Indian households

Power Generation Potential

• Daily Generation: 4,000 units

• Monthly Generation: 1.2 lakh units

• Annual Generation: 14–15 lakh units

This estimate can vary based on geography, panel orientation, module type, and solar irradiance.

Land Requirement for 1 MW Plant

Setting up a 1 MW solar plant typically requires 4 to 5 acres of land, depending on the layout and whether trackers are used. For rooftop installations, this translates to approximately 100,000 square feet of shadow-free roof space.

1 Megawatt Solar Power Plant Cost in India

1MW solar power plant cost in India ranges between ₹4 crore to ₹6 crore, depending on the type of installation (rooftop or ground-mounted), quality of components, and whether battery backup is included.

Cost Breakdown:

Types of 1 MW Solar Power Plants

1. On-Grid (Grid-Tied) System

• No battery storage

• Power is consumed internally; surplus is sent to the grid

• Suitable for industries, schools, commercial spaces
  
  

2. Off-Grid System

• Includes battery bank

• High initial cost due to energy storage

• Ideal for remote areas with no grid access
  
  

3. Hybrid System

• Combines grid connection and battery backup

• Ensures power even during outages

• Offers better reliability with moderate cost increase

Operation & Maintenance (O&M) Costs

O&M is minimal but crucial. Annual O&M costs for a 1 MW solar plant typically range between ₹6–₹10 lakh and include:

• Panel cleaning (automated or manual)

• Inverter servicing

• Data monitoring

• Site security and insurance

Return on Investment (ROI) and Payback Period

The payback period for a 1 Megawatt solar plant is generally 3 to 4 years, depending on the power tariff and plant performance. Over its lifetime (25+ years), the plant can offer 6–8 times return on the initial investment.

Sample Revenue Calculation:

• Annual units generated: 14,00,000

• Power selling price: ₹3.5/unit

• Annual revenue: ₹49,00,000

• Annual O&M: ₹8,00,000

• Net savings: ₹41,00,000 per year

Government Policies & Incentives

Although there is no central subsidy for 1 MW plants under commercial use, investors can still benefit from:

• Accelerated Depreciation (AD) under Income Tax Act

• Net Metering (subject to state policies)

• State-level capital subsidies (in some states)

• GST benefits (lower tax on solar components)

• Carbon credits and RECs for large-scale developers

Technical Specifications

A standard 1 MW solar power plant consists of:

• 2,500–3,200 solar panels (depending on wattage)

• Inverter capacity of 1,000 kW or higher

• Galvanized steel or aluminum mounting structures

• Remote monitoring system (SCADA)

• Transformer & switchgear for grid integration

Panel choice (Mono PERC, or Bifacial) can influence both performance and cost.

Who Should Consider a 1 MW Solar Plant?

• Manufacturing Units with high electricity consumption

• Educational Institutions and Hospitals

• Warehouses, Commercial Parks, and Malls

• Utility-scale solar project developers

• Government or PPP-based projects

Benefits of a 1 MW Solar Power Plant

• Significant savings on electricity bills

• 25+ years of clean energy

• Enhanced brand value through sustainability

• Low operating costs and high returns

• Supports environmental compliance and carbon reduction

Challenges to Consider

• High upfront capital requirement

• Land availability (for ground-mounted systems)

• State policy changes (especially net metering rules)

• System degradation over time (0.5–0.7% per year)

However, most of these challenges can be addressed through proper planning, EPC partner selection, and smart O&M practices.

Conclusion

Setting up a 1MW solar power plant is a smart investment for businesses and institutions with long-term vision. Despite the initial capital, the long-term benefits—both financial and environmental—are immense. With India's supportive solar ecosystem, now is the perfect time to transition to solar and power your future with the sun.

FAQs on 1 Megawatt Solar Power Plant Cost in India

1. What is the cost of a 1 MW solar power plant in India in 2024?

The average cost of installing a 1 MW (megawatt) solar power plant in India ranges between ₹4 crore to ₹5.5 crore depending on:

• Land cost (if applicable)

• Type of solar panels (Mono PERC, TOPCon, etc.)

• Type of installation (ground-mounted or rooftop)

• Inverter technology

• Civil & electrical infrastructure

• EPC and O&M services

2. What are the components included in this cost?

The total cost typically includes:

• Solar PV modules

• Inverters

• Module mounting structures

• Cables, transformers, and switchgear

• Land development and civil work

• Installation and commissioning

• Operation & Maintenance (O&M) for 5–25 years

3. How much land is required for a 1 MW solar plant?

A ground-mounted 1 MW solar power plant generally requires around 4 to 5 acres of land. The exact requirement depends on panel efficiency and layout.

4. What is the expected energy generation from a 1 MW solar plant?

On average, a 1 MW solar power plant in India generates around 4,000–4,500 units (kWh) per day, totaling about 14 -16 lakh units per year, depending on the location, solar irradiance, and system efficiency.

5. What is the payback period for a 1 MW solar plant?

The typical payback period is between 4 to 6 years, based on:

• Project cost

• Tariff rate (PPA or captive consumption)

• Government subsidies or tax benefits

• Annual generation

6. Is there any subsidy for a 1 MW solar plant?

Subsidy is generally not available for commercial/industrial-scale 1 MW plants under central government schemes like PM Surya Ghar Yojana, which are mainly for residential rooftops. However, benefits like Accelerated Depreciation (AD), GST concessions, and banking facilities are available to industrial/commercial investors.

7. Can a 1 MW solar plant be installed on a rooftop?

Technically yes, but you need at least 10,000 sq. meters of shadow-free rooftop space. Due to space limitations, most 1 MW plants are ground-mounted.

8. What are the types of 1 MW solar power plants?

• On-grid (connected to DISCOM)

• Captive (for self-use by industrial consumers)

• Group Captive (shared investment and usage)

• Open Access (selling power to third parties or large consumers)

9. Who are the top EPC companies for 1 MW solar power plants in India?

Several reputable companies offer turnkey EPC services, including:

• Bluebird Solar

• Tata Power Solar

• Adani Solar

• Jakson Solar

• Vikram Solar

• Waaree Energies

10. Can I sell electricity generated from my 1 MW plant?

Yes, you can sell the power through:

• Power Purchase Agreements (PPA) with private clients or DISCOMs

• Open Access route

• Net metering (if permitted in your state for large-scale systems)

11. How long is the lifespan of a 1 MW solar power plant?

Solar plants typically last 25–30 years, with solar modules often having 25-year performance warranties.

12. What are the maintenance costs of a 1 MW solar plant?

Annual maintenance costs are around ₹3–5 lakhs, covering:

• Module cleaning

• Inverter servicing

• Electrical safety checks

• Monitoring software