Hybrid vs on-grid inverter for PM Surya Ghar

Every PM Surya Ghar quote forces one design call: on-grid or hybrid. The hybrid vs on-grid inverter decision sets your customer's backup, your price, and your margin — but it does not change the subsidy on the solar system. Get the trade-off right and you win more jobs.

On-grid vs hybrid: what is the actual difference?

An on-grid inverter feeds solar power to the home and exports the surplus to the grid, while a hybrid inverter does the same and also charges a battery. The key gap is backup. When the grid fails, an on-grid system shuts down for safety; a hybrid system keeps chosen loads running from the battery.

How an on-grid system behaves

An on-grid (grid-tied) system has no battery. It uses solar first, pulls the rest from the grid, and sends extra units back through a net meter. During a power cut it stops — this "anti-islanding" rule protects line workers. For homes with a stable grid, this is the cheapest path to a lower bill.

How a hybrid system behaves

A hybrid system adds a battery and a hybrid inverter. It can still export to the grid, but it also stores power and runs selected loads — lights, fans, a fridge, a router — when the grid is down. The customer pays more for that backup, and the EPC carries more kit and design work.

What does the PM Surya Ghar subsidy actually cover?

The PM Surya Ghar subsidy covers the grid-connected rooftop solar system, not the battery. It is calculated on the MNRE benchmark cost and the system capacity, not on your quote. So a hybrid quote earns the same solar subsidy as an on-grid quote of the same size.

The subsidy numbers, fixed on benchmark cost

The subsidy is ₹30,000 per kW up to 2 kW, plus ₹18,000 for the third kW — a ₹78,000 cap at 3 kW and above. A 5 kW or 10 kW home system still receives ₹78,000. The amount is paid to the customer by DBT after commissioning and net-meter installation, not to the EPC. Our subsidy slabs guide breaks down how the cap is built.

Where the battery sits

In most states the battery, its wiring and the hybrid inverter premium are not subsidised. The customer pays for storage on top of the subsidised solar system. Battery and storage rules vary and can change, so verify the current battery position with MNRE and your target DISCOM before you promise anything in a quote.

Is a hybrid setup net-metering eligible and DISCOM-approved?

A hybrid setup can be net-metering eligible if the DISCOM approves it and the system meters export correctly. The subsidy and net metering follow the grid-connected solar system, which a hybrid still has. But some DISCOMs add conditions for storage, so approval is not automatic.

Why deemed feasibility helps

Systems up to 10 kW have deemed feasibility for net metering under the Electricity (Rights of Consumers) Rules 2020. That smooths the connection for most homes. Even so, the DISCOM still checks the meter setup and may treat a battery system differently.

Confirm before you quote

Hybrid net-metering eligibility is the one thing you must check per DISCOM. Some DISCOMs allow hybrid freely; others restrict export from stored energy or want extra metering. Always confirm hybrid net-metering rules with your target DISCOM, and read our net-metering process guide for the full application flow.

Does quoting hybrid change the subsidy?

Quoting hybrid does not change the subsidy on the solar part. The subsidy is fixed on the MNRE benchmark cost and system size, so the customer still gets up to ₹78,000 at 3 kW or more. The battery simply adds an unsubsidised line to the quote.

This is an easy win to explain to customers. They keep the full solar subsidy and pay extra only for the backup they choose. Show the subsidised solar block and the unsubsidised battery block as separate lines so the customer sees exactly what the government pays and what they pay.

Hybrid vs on-grid: the trade-off matrix

Use this matrix to walk a customer through the choice. Each row is a decision dimension; the columns show how on-grid and hybrid compare on that dimension.

Source: SuryaHub design notes based on MNRE scheme rules. Subsidy and battery positions are estimates — verify the current rules with MNRE and your target DISCOM.

When should you upsell battery backup?

Upsell battery backup when the customer faces frequent or long power cuts, runs critical loads, or already burns diesel in a generator. For a home on a stable grid, a plain on-grid system gives the best payback and the lowest bill.

• Frequent outages — daily or long cuts make backup worth the extra cost.
• Critical loads — a home office, medical equipment, or a shop that cannot stop.
• Existing generator — a battery can replace noisy, costly diesel running.
• Stable grid — skip the battery; the payback rarely justifies it.

Lead with the customer's real outage pattern, not the bigger ticket. An honest "you do not need a battery here" builds trust and still wins the on-grid job.

Cost and margin trade-offs

A hybrid system costs the customer more but usually gives the EPC a wider margin. The battery and hybrid inverter are premium, less price-comparable parts, so they are harder for a customer to shop on price. On-grid quotes are price-led and thinner.

Why hybrid protects margin

On-grid systems compete almost entirely on rupees per kW, which squeezes margin. A battery package is a design-and-comfort sale, so you compete on backup hours and reliability instead of price alone. That shift is where the extra margin lives — see our EPC margin and pricing guide.

Mind the working-capital and cell-sourcing cost

Batteries tie up more working capital and add warranty exposure, so price for that. Your panel and cell sourcing also affects cost and eligibility — read our DCR vs non-DCR decision guide before you lock the bill of materials.

Two customer scenarios

The right inverter depends on the customer, not a rule of thumb. Two common cases show how to choose.

Stable grid, bill-focused homeowner

A family in a city with reliable supply wants a lower electricity bill. Quote a clean on-grid system. They get the full subsidy, net metering exports their surplus, and the payback is short. A battery here only slows the payback.

Frequent outages, backup-focused homeowner

A household in an area with daily cuts wants lights, fans and a fridge to keep running. Quote a hybrid system, but split the quote so they see the subsidised solar and the unsubsidised battery as separate lines. They keep the full solar subsidy and buy exactly the backup they need.

How do you size the battery and the backup loads?

Size the battery to the loads the customer wants to run during a cut, not to the whole house. List the essential loads first — lights, fans, a fridge, a router, maybe a TV. Add up their watts and the hours of backup the customer expects. That number sets the battery size, not the solar array size.

Separate the backup circuit

In most hybrid designs, only a backup sub-circuit stays live during an outage, not every socket in the home. Decide with the customer which circuits matter. A smaller backup circuit means a smaller, cheaper battery and a clearer promise. Quoting "whole-home backup" and then delivering a partial circuit is a common cause of disputes.

Match the inverter rating to the backup load

The hybrid inverter must handle the peak backup load, including motor surges from a fridge or pump. Undersize it and the backup trips when the compressor starts. Size the inverter to the backup loads and the solar array together, and confirm the model is approved for grid connection. Inverter approval lists and standards change — verify the current requirement against MNRE and your DISCOM.

What quoting pitfalls should EPCs avoid with hybrids?

The biggest hybrid quoting pitfall is mixing the subsidised solar and the unsubsidised battery into one price, which confuses the customer and risks the subsidy claim. Keep them on separate lines. A few more pitfalls catch EPCs out on hybrid jobs.

• Promising the subsidy on the battery — the battery is usually not subsidised, so never imply the government pays for it (verify the current scheme scope).
• Assuming hybrid is net-metering eligible everywhere — confirm with the target DISCOM before you quote export credits on a hybrid system.
• Overselling backup duration — a battery sized for two hours will not run the house all night; state the realistic backup window.
• Ignoring battery replacement cost — batteries wear out before the panels, so include the likely replacement in the customer's long-term cost.
• Skipping the load list — without an agreed backup load list, the customer expects more than the system delivers.

When you quote a hybrid, write down what the system will and will not do during a cut. That one honest paragraph prevents most complaints. For the pricing side, our EPC margin and pricing guide shows how to keep a healthy margin on the unsubsidised battery line.

How SuryaHub helps you quote both options

SuryaHub lets you build an on-grid quote and a hybrid quote side by side, so you can show the customer the subsidy, the battery cost and the payback for each in one clear view. Our solar quotation software keeps the subsidised and unsubsidised lines separate, so nothing about the ₹78,000 cap is misstated. SuryaHub is pre-revenue; real pilots are Suryantra Energy and RGESPL, and the subsidy and battery figures here are scheme facts, not guarantees.

Related guides

Frequently asked questions

Sources & references

Subsidy rules, what the subsidy is calculated on, and net-metering eligibility come from primary government sources. Battery and hybrid net-metering rules vary by state and change — always confirm the current position with MNRE and your target DISCOM before you quote.

• Ministry of New & Renewable Energy (MNRE) ↗

  Scheme guidelines and what the subsidy is calculated on.

• National Portal for PM Surya Ghar ↗

  Eligible system definition and the consumer/vendor process.

• Central Electricity Authority (CEA) ↗

  Grid-connection and metering safety regulations.