How going solar turns energy costs into tax benefits in India 

While net metering delivers visible operational savings, the tax benefits of solar often reveal themselves closer to year's end. 

Under Section 32 of the Income Tax Act, solar assets qualify for 40% accelerated depreciation on a Written Down Value basis. This allows businesses to depreciate a significant portion of the asset early, reducing taxable income during years when capital expenditure is highest. 

Accelerated depreciation illustration 

Beyond depreciation, GST and Input Tax Credit influence how capital flows through the business. 

Eligible industrial solar projects allow businesses to claim Input Tax Credit on applicable components, reducing the net cash outflow tied up in the installation. This directly lowers the effective project cost and prevents excess capital from remaining locked into infrastructure. 

From a working capital perspective, this matters. Funds that would otherwise remain blocked can be redeployed toward inventory, automation, or expansion. For organisations operating multiple facilities, ITC also brings greater structure and predictability to cash flow planning across the financial year. 

Across industrial clusters, a noticeable number of solar installations are commissioned between December and January. 

The reason lies in timing. Systems commissioned before March 31 qualify for full depreciation within the same financial year. GST credits can be claimed earlier. Power savings begin reflecting on electricity bills immediately. 

From a financial standpoint, this timing improves EBITDA visibility, strengthens year-end cash flows, and creates additional headroom on the balance sheet before books are closed. For businesses planning capital expenditure in the following year, this window helps offset upcoming financial commitments. 

Commissioning solar before March 31 maximizes depreciation benefits, accelerates GST credit claims, and improves year-end EBITDA visibility 

For industrial solar, incentives alone are not enough. Execution quality, regulatory clarity, and long-term service support are equally important. 

Industries choose Tata Power Solaroof for its depth of engineering expertise, nationwide presence, and long-standing understanding of utility processes. With decades of experience in power infrastructure, manufacturing capability at scale, and strong financing partnerships, Tata Power Solaroof supports industries through design, approvals, installation, and long-term operations. 

For businesses making a 20-plus-year energy decision, predictability matters. Harness the power of the sun with advanced solar rooftop systems built for long-term reliability. 
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For Indian industries, solar has moved beyond intention and into execution. It affects how power costs are managed, how taxes are planned, and how cash flows are structured. 

Each year an installation is delayed is a year of missed savings and foregone financial flexibility. In an environment where margins are constantly under scrutiny, those missed opportunities tend to surface eventually. The sun is already doing the work. The decision now lies in how soon businesses choose to let it support their balance sheets.