Quick Answer
- A manufacturing unit calculates solar savings by multiplying solar generation in units per month by the applicable TANGEDCO industrial tariff rate per unit
- The key inputs are monthly solar generation from the installed system size, the unit’s TANGEDCO connection category and applicable tariff rate, and operating hours during which solar generation and factory load overlap
- Chennai manufacturing units on HT industrial tariff pay ₹5.50 to ₹8.00 per unit — making each solar unit generated worth significantly more than in a residential context
- A 100kW solar system in a Chennai factory generates approximately 12,000 units per month — saving ₹66,000 to ₹96,000 per month at HT industrial tariff rates
- SKS Synergies conducts detailed electricity bill analysis and solar savings modelling for manufacturing units across Chennai before any investment commitment
Why Accurate Solar Savings Calculation Matters for Chennai Manufacturing Units
A manufacturing unit considering solar investment needs a precise and credible savings calculation — not a generic estimate based on average tariff rates and standard generation assumptions. Manufacturing electricity consumption is more variable and complex than commercial or residential consumption — driven by production schedules, shift patterns, machine load cycles, power factor penalties, and demand charges that all affect the relationship between solar generation and actual bill reduction.
An inaccurate savings calculation — whether overstated by an enthusiastic vendor or understated through oversimplification — leads to either disappointing post-installation outcomes or missed investment opportunities. Understanding exactly how to calculate solar savings for a Chennai manufacturing unit allows factory owners and finance managers to evaluate the investment on genuinely accurate financial terms.
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Understanding Your Factory’s TANGEDCO Bill Before Calculating Solar Savings
The starting point for calculating solar savings is a thorough understanding of your manufacturing unit’s current TANGEDCO bill structure — which is significantly more complex than a domestic or small commercial bill.
Energy charges
Energy charges are the units consumed multiplied by the applicable tariff rate for your connection category. For HT industrial consumers in Tamil Nadu energy charges vary by time of use in some tariff categories — with peak hours attracting higher rates than off-peak hours. Solar generation during peak tariff hours delivers proportionally greater savings than generation during off-peak hours.
Demand charges
HT industrial consumers pay a monthly demand charge based on their sanctioned or recorded maximum demand in kVA — regardless of actual energy consumption. Solar generation reduces energy charges but does not directly reduce demand charges — as demand is typically measured at the point of peak instantaneous load which may occur outside solar generation hours.
Power factor penalty or incentive
TANGEDCO applies power factor penalties to consumers whose power factor falls below 0.85 — and incentives for consumers maintaining power factor above 0.95. Solar inverters can be configured to assist in power factor correction — potentially converting a power factor penalty into a neutral or incentive position and improving overall bill reduction beyond direct energy charge savings.
Fixed charges
Monthly fixed charges apply regardless of consumption or solar generation — these cannot be offset by solar and remain payable after installation.
The Solar Savings Formula for a Chennai Manufacturing Unit
The basic solar savings calculation for a manufacturing unit follows this formula:
Monthly savings equals solar generation in units per month multiplied by the weighted average tariff rate applicable to the units being displaced.
The weighted average tariff rate calculation is the critical step that differentiates an accurate manufacturing savings model from a simplified estimate. For a manufacturing unit with both peak and off-peak tariff periods the proportion of solar generation falling in each tariff period must be calculated to determine the weighted average saving per unit.
A factory operating two shifts from 6am to 10pm displaces peak tariff units during morning and afternoon solar generation hours — achieving the maximum savings rate per unit. A factory operating only night shifts from 10pm to 6am generates solar during hours when the factory is not operating — with all solar units exported to the grid at net metering credit rates rather than directly displacing high-cost import units.
Example Solar Savings Calculation for a Chennai Manufacturing Unit
Consider a Chennai manufacturing unit on an HT industrial connection consuming 80,000 units per month across two 8-hour day shifts operating from 6am to 10pm at an average tariff of ₹7.00 per unit and a 100kW rooftop solar system generating 12,000 units per month.
During solar generation hours from 7am to 5pm the factory is operating at full production load — consuming all 12,000 solar units directly with no export. Monthly savings from direct self-consumption — 12,000 units multiplied by ₹7.00 — equals ₹84,000 per month or ₹10,08,000 per year.
This ₹84,000 monthly saving against a net system investment of approximately ₹35,00,000 to ₹42,00,000 after GST credit and accelerated depreciation delivers a payback period of approximately 3.5 to 4.2 years — with 20-plus years of continued savings following payback.
Key Takeaways
- Manufacturing solar savings equal monthly generation in units multiplied by the weighted average tariff rate for displaced units
- HT industrial tariff rates of ₹5.50 to ₹8.00 per unit make each solar unit highly valuable for Chennai factories
- Demand charges and fixed charges cannot be offset by solar — accurate savings calculations exclude these components
- Shift timing relative to solar generation hours critically affects self-consumption rate and savings per unit
- SKS Synergies conducts detailed bill analysis and solar savings modelling for manufacturing units across Chennai before any investment commitment
Frequently Asked Questions
Can a Chennai factory claim solar savings on demand charges through TANGEDCO net metering? No. Solar net metering credits offset energy charges — not demand charges. Demand charges are based on peak instantaneous load regardless of solar generation. Some factories achieve modest demand charge reduction by scheduling high-load processes during solar generation hours — reducing peak demand slightly — but solar does not eliminate demand charges.
How does shift timing affect solar savings for a Chennai manufacturing unit? Factories operating day shifts during solar generation hours achieve maximum direct self-consumption — saving at the full import tariff rate per unit. Night-shift-only factories export all solar generation at net metering credit rates — which may be lower than import rates. Mixed shift operations achieve intermediate savings depending on the proportion of load coinciding with solar generation.
Can a Chennai manufacturing unit install solar during a production expansion without disrupting operations? Yes. SKS Synergies plans installation schedules around production requirements — conducting rooftop work during planned maintenance shutdowns or low-production periods where possible. Physical installation of industrial solar systems is conducted safely without interrupting factory floor operations.
Does a Chennai factory need to modify its existing electrical switchgear for solar installation? Most existing factory switchgear requires addition of a solar isolation switch and appropriate protection relays for grid-connected solar — SKS Synergies assesses existing switchgear during the site survey and advises on any modifications needed before installation begins.
Want to calculate exactly how much solar can cut your Chennai factory’s EB bill? SKS Synergies provides free detailed electricity bill analysis and solar savings modelling for manufacturing units across Chennai and Tamil Nadu. WhatsApp us today and our industrial solar expert will give you a precise savings figure based on your actual TANGEDCO bills and production schedule.