India’s solar market continues to grow in 2026, supported by national renewable energy targets set by the Ministry of New and Renewable Energy (MNRE), attracting investors and developers.
Is a 1MW solar plant really profitable in India today?
Let’s break down the real numbers — cost, revenue, and returns.
1MW Solar Plant Cost in India (2026)
The average cost of a 1MW ground-mounted solar plant in 2026 ranges between:
₹3.8 Crore to ₹4.5 Crore
This depends on:
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Location
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Land condition
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Module technology
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Distance from substation (evacuation cost)
Major Cost Components:
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Solar Modules
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Inverters
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Mounting Structure
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Civil & Foundation Work
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Transformer & HT Panel
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Cabling & SCADA
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Land Development
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Evacuation Infrastructure
Evacuation and land development can significantly impact total investment.
How Much Power Does a 1MW Solar Plant Generate?
Average CUF (Capacity Utilization Factor) in strong solar states like Rajasthan and Gujarat is:
17% – 22%
Estimated annual generation:
1MW × 8,760 hours × 19% CUF ≈
1.6 – 1.75 million units per year
Revenue from a 1MW Solar Plant
Current utility-scale solar tariffs discovered through competitive bidding by the Solar Energy Corporation of India (SECI) range between ₹2.3 to ₹3.0 per kWh.
₹2.3 to ₹3.0 per kWh
Assuming ₹2.7 per unit:
1.7 million units × ₹2.7 ≈
₹45–46 Lakhs annual revenue
Annual Expenses
Typical yearly expenses include:
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O&M: ₹6–8 Lakhs
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Insurance: ₹1–2 Lakhs
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Land Lease (if applicable): ₹3–6 Lakhs
Total Annual Expenses:
₹10–15 Lakhs
Net Profit & Payback Period
Annual Revenue: ₹45–50 Lakhs
Annual Expenses: ~₹12 Lakhs
👉 Net Operating Income: ₹33–38 Lakhs per year
If project cost = ₹4.2 Crore
Simple Payback Period ≈
11–13 Years
IRR may range between 11%–16%, depending on financing structure and project efficiency.
What Affects Real Profitability?
Actual returns depend on:
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Accurate CUF estimation
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Proper DC/AC ratio design
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Land selection near substation
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Avoiding hidden evacuation costs
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Managing degradation and maintenance
Small design mistakes can reduce long-term returns significantly.
Final Verdict
A 1MW solar plant in India in 2026 can be a stable long-term investment, generating:
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₹45–50 Lakhs annual revenue
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₹30–38 Lakhs net income
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11–13 year payback
However, profitability depends heavily on planning, engineering design, and financial structuring.
Smart design makes the real difference between an average project and a high-performing asset.
Thank you for reading.
If you are planning a solar project and need professional design or feasibility support, feel free to connect with us.
