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Financial Strategy

CAPEX vs OPEX Solar Models

Choose the best financial model for your business. Whether you want to own the asset for maximum ROI or go solar with zero upfront investment.

Two Ways to Go Solar

For Commercial and Industrial (C&I) clients, solar adoption is as much a financial decision as it is a technical one. Depending on your cash flow and tax situation, you can choose between self-ownership (CAPEX) or a third-party service model (OPEX).

CAPEX Model (Capital Expenditure)

In the CAPEX model, the consumer pays the entire cost of the solar system upfront. You own the system, and all the electricity generated belongs to you.

Max Long-term Savings

Once the 3-5 year payback is over, you get free electricity for 20+ years.

Asset Ownership

The solar plant becomes a valuable asset on your company's balance sheet.

Accelerated Depreciation

Claim 40% depreciation in the first year to save significantly on income tax.

Full Control

You choose the premium components and control the maintenance quality.

OPEX / RESCO Model

In the OPEX (Renewable Energy Service Company) model, a third-party developer (RESCO) installs, owns, and maintains the solar plant on your premises. You only pay for the units of electricity you consume at a fixed tariff.

Key Benefit: Zero Investment

Go solar without touching your capital. Pay only a per-unit rate that is 20-40% cheaper than the grid tariff.

  • No Maintenance Hassle: Developer handles all repairs and cleaning.
  • Performance Guaranteed: You only pay for what is generated.
  • Immediate ROI: Savings start from Day 1 of commissioning.

Comparison Table

Feature CAPEX OPEX
Investment Upfront (High) Zero (Zero)
Ownership Consumer Developer
Payback 3 - 5 Years Immediate
Tax Benefits Available None
Maintenance Owner's Risk Developer's Risk

Tax & GST Advantages

Choosing the CAPEX model offers unique advantages for profitable businesses in India:

  • Accelerated Depreciation (AD): Claim 40% depreciation in Year 1. For a ₹1 Cr project, this could mean an immediate tax shield of ₹25-30 Lakhs depending on your tax bracket.
  • GST Input Credit: Claim the 12% GST paid on solar components against your output GST liability.

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