Two ways to buy solar without a rooftop
Most factories that want cheaper, greener power quickly run out of roof. A 5,000 kW load needs far more solar than a shed roof can hold, so the electrons have to come from a plant somewhere else and travel over the grid to reach you. In India there are two established ways to do that: captive and open access. They sound similar — both deliver third-party solar over the wires — but they are governed by different rules, carry different charges, and suit different kinds of buyers.
Getting the choice right is worth real money. The landed cost of power can swing by a rupee or more per unit depending on which route you take, and the wrong structure can expose you to a surcharge you thought you had avoided.
Captive: you own a slice of the plant
Under India’s Electricity Rules 2005, a generating plant is “captive” if the consuming factory holds at least 26% of the plant’s equity and consumes at least 51% of the electricity it generates in a financial year. For a group captive — several factories sharing one plant through an Association of Persons — the 26% and 51% tests apply to the users collectively, with each user’s consumption broadly tracking its ownership share within a 10% band.
The reward for meeting those tests is significant: captive users are exempt from the cross-subsidy surcharge and the additional surcharge, the two levies that make grid and open-access power more expensive. That exemption is the main reason captive landed tariffs are often quoted well below the DISCOM’s commercial and industrial (C&I) rate.
The catch is the 51% line. If collective consumption dips below 51% in any year — a demand slump, a shutdown, a plant running hotter than the factory can absorb — the arrangement can lose captive status for that year, and the surcharge can become payable retrospectively. The Supreme Court has since clarified how the ownership and consumption tests are read, and the rules were refined again through amendments in 2026 that let an anchor consumer holding 26% or more consolidate equity — but the underlying discipline is unchanged: you must reliably use the power you own.
Open access: you buy, you don’t own
Open access lets a factory buy power from an independent developer’s plant and have it wheeled to the site — without taking any equity. Since the Green Energy Open Access Rules 2022, this route opened up dramatically: the eligibility threshold dropped from 1 MW (the old limit under Section 42 of the Electricity Act 2003) to just 100 kW of contracted demand for green power, and applications are deemed approved in 15 days if the DISCOM does not act.
Open access does pay the cross-subsidy surcharge — but the 2022 rules capped it (it cannot be raised by more than 50% of the rate set in your year of grant, for twelve years) and removed the additional surcharge for green open access. You still pay wheeling, transmission, standby and, if you bank surplus solar for later, banking charges. The trade is straightforward: a somewhat higher landed tariff than captive, in exchange for no equity, no 51% obligation, and a much simpler contract to enter and exit.
We cover the mechanics of this route in detail in our companion guide, open-access solar in India, explained.
How the numbers tend to stack up
The headline pattern is consistent across most states: captive < open access < grid. Captive’s edge comes almost entirely from dodging the surcharges. But the ranking is not a law of nature — a state with a low cross-subsidy surcharge narrows the captive advantage, while a factory that cannot commit to 51% consumption may find open access the only realistic option. The honest comparison always uses your own state’s charges and your own load.
| Captive | Open access | |
|---|---|---|
| Ownership required | ≥26% equity in the plant | None |
| Consumption obligation | ≥51% of annual output | None |
| Cross-subsidy surcharge | Exempt | Payable, but capped |
| Additional surcharge | Exempt | Waived for green OA |
| Wheeling / transmission | Payable | Payable |
| Contract flexibility | Lower — equity lock-in | Higher — buy and exit |
| Typical landed cost | Lowest | Slightly higher |
Where a battery fits in either model
Neither captive nor open access changes the physics of solar: it is generated at midday and disappears in the evening, while a two- or three-shift factory runs around the clock. That mismatch is exactly what storage addresses, and it earns its keep in both models.
- It lifts self-consumption. Under captive, storing midday surplus and drawing it in the evening helps you actually use the 51% you are obliged to consume, protecting your captive status.
- It shifts solar into the peak. Both routes still leave you buying some grid power at the evening Time-of-Day peak; a battery moves cheap daytime solar into that expensive window.
- It shaves demand charges. The grid still records your peak kVA and bills a demand charge for it, whatever your energy source — and a battery keeps the meter below the line.
A solar-plus-storage configuration captures all three at once, which is why a battery often improves the economics of a captive or open-access plant rather than competing with it.
What this means for you
If your factory can reliably consume the output and you want the lowest landed cost, captive (or group captive) usually wins — provided you are comfortable holding equity and defending the 51% line every year. If you want green power without ownership, a short path to signing, and the freedom to exit, open access is the simpler entry, and the 2022 rules have made it far more attractive than it used to be. In both cases a right-sized battery — from a compact C&I cabinet up to a containerised grid-scale block — turns a daytime solar plant into round-the-clock savings.
The right answer depends on your state’s charges, your shift pattern and how much of the plant you can absorb. Run your tariff and load through our savings calculator, or send us your bills and consumption profile and we will model captive versus open access for your site.
Policy snapshot as of July 2026. Captive qualification rules, cross-subsidy surcharge caps, wheeling and banking charges and green open-access terms are set by central rules and state regulations and change by notification — verify the current terms for your state and DISCOM before financial decisions.