Glossary
The terms and abbreviations used in Indian solar investing, in plain language.
- AC and DC Alternating current and direct current
- Solar panels produce direct current (DC); inverters convert it to alternating current (AC) for the grid. A plant's MW AC is its grid export limit; MWp DC is its panel capacity, usually 20–40% higher.
- ACRA Accounting and Corporate Regulatory Authority
- Singapore's company registry. Its business profile is the standard proof that a Singapore company exists and who runs it.
- ALMM Approved List of Models and Manufacturers
- The government list of approved solar modules (List-I) and, from 1 June 2026, solar cells (List-II). Government-supported and many tendered projects must use listed equipment.
- BIT Bilateral investment treaty
- A treaty between two countries that protects investors from each against unfair treatment or expropriation, usually with access to international arbitration.
- C&I Commercial and industrial
- Companies that buy power directly from a solar plant, through open access or a captive arrangement, rather than through a state utility.
- CCD / CCPS Compulsorily convertible debentures / preference shares
- Instruments that must convert into equity shares. Under Indian rules they count as foreign direct investment, not foreign debt.
- CEA Central Electricity Authority
- India's technical authority for the power sector. It sets grid connection, safety and equipment standards that plants must meet.
- CEIG Chief Electrical Inspector to Government
- The state electrical inspector whose approval is needed before a plant's high-voltage equipment is energised, with periodic inspections after.
- CEPA Comprehensive Economic Partnership Agreement
- A trade and investment agreement. India's CEPA with Japan (2011) includes an investment chapter.
- CERC Central Electricity Regulatory Commission
- India's national electricity regulator. It sets rules for inter-state power trading, transmission charges and deviation charges.
- CMA Capital Market Authority
- Saudi Arabia's securities regulator. Investment offers to Saudi residents must go through a firm it has authorised.
- COP26 26th UN Climate Change Conference
- The 2021 climate summit in Glasgow, where India announced its targets of 500 GW of non-fossil capacity by 2030 and net zero by 2070.
- Crore and lakh Indian number units
- One lakh is 100,000 and one crore is 10 million. ₹1 crore is about USD 105,000 at ₹95 to the dollar.
- CUF Capacity utilisation factor
- The energy a plant actually produces in a year as a share of what it would produce running at full capacity every hour. Indian solar plants typically achieve 18–25%.
- DCR Domestic content requirement
- A rule that plants under some government schemes must use solar cells and modules made in India. DCR modules cost more, so plant prices and tariffs differ between DCR and imported-module plants.
- DISCOM Distribution company
- A state electricity utility that buys power from generators and sells it to consumers. Many solar plants sell their output to a DISCOM.
- DPIIT Department for Promotion of Industry and Internal Trade
- The Indian government department that publishes the Consolidated FDI Policy.
- DTAA Double taxation avoidance agreement
- A tax treaty between India and another country. It can lower Indian withholding tax on dividends and interest paid to investors from that country.
- EBITDA Earnings before interest, tax, depreciation and amortisation
- A plant's operating profit: revenue minus running costs such as O&M, land lease and insurance. Plant prices are often compared as a multiple of EBITDA.
- ECB External commercial borrowing
- A loan to an Indian company from a lender outside India, governed by RBI rules on lenders, cost, maturity and use of funds.
- ESG Environmental, social and governance
- The non-financial factors many funds must assess and report on. Operating solar plants score well on environmental measures; land, labour and supply-chain checks cover the rest.
- FATCA Foreign Account Tax Compliance Act
- A US law requiring US taxpayers to report foreign financial assets, and foreign banks to report accounts held by US persons.
- FATF Financial Action Task Force
- The international anti-money-laundering body. Countries on its grey list face extra checks from banks.
- FBAR Report of Foreign Bank and Financial Accounts
- A yearly US filing (FinCEN Form 114) required from US persons with signing authority over, or an interest in, foreign accounts above USD 10,000 in total.
- FC-GPR Foreign currency gross provisional return
- The RBI form reporting new shares issued to a foreign investor, due within 30 days of allotment.
- FC-TRS Foreign currency transfer of shares form
- The RBI form reporting a transfer of shares between an Indian resident and a non-resident, due within 60 days of the transfer.
- FDI Foreign direct investment
- Investment by a non-resident in the shares or convertible instruments of an Indian company. Power generation allows 100% FDI under the automatic route.
- FIRMS Foreign Investment Reporting and Management System
- The RBI online portal where foreign-investment forms such as FC-GPR and FC-TRS are filed.
- FLA return Foreign Liabilities and Assets return
- An annual RBI return, due 15 July, filed by every Indian company with foreign investment.
- Form 10F Indian tax form for treaty benefits
- A form, filed online, that a non-resident gives with a tax residency certificate to claim a lower tax-treaty rate.
- Form 15CA and 15CB Indian tax forms for payments abroad
- Filed before money is sent out of India, such as dividends to a foreign shareholder. 15CB is a chartered accountant's certificate of the tax due; 15CA is the remitter's declaration to the tax department, which the bank checks before paying.
- FX Foreign exchange
- Buying and selling currencies. FX risk is the chance that the rupee moves against your home currency and changes the value of your returns.
- FY Financial year
- India's financial year runs from 1 April to 31 March; FY 2025-26 ended on 31 March 2026.
- GST Goods and services tax
- India's indirect tax. Solar modules and systems are taxed at 5% from 22 September 2025; sales of electricity are exempt.
- GW, MW, MWp, kWh Units of power and energy
- MW (megawatt) and GW (gigawatt, 1,000 MW) measure capacity; MWp is a plant's panel (DC) capacity. kWh, MWh and GWh measure energy produced. A 1 MW plant in India produces roughly 1,600–2,100 MWh a year.
- I-V curve Current-voltage curve
- A test that traces how current and voltage vary across a string of solar panels. It shows degraded, damaged or mismatched modules that simple output readings miss.
- INR Indian rupee
- India's currency, shown as ₹. Plant tariffs, revenues and dividends are in rupees.
- InvIT Infrastructure investment trust
- A listed or private trust that owns operating infrastructure, such as solar portfolios, and pays out most of its cash to unit holders.
- IREDA Indian Renewable Energy Development Agency
- A government-owned lender that finances renewable energy projects in India.
- IRENA International Renewable Energy Agency
- An intergovernmental agency that publishes global renewable energy statistics, including country rankings by installed capacity.
- IRR Internal rate of return
- The annual return that makes an investment's cash flows worth zero today. Equity IRR is the return on the investor's own money after debt.
- IRS Internal Revenue Service
- The US federal tax authority. Its Form 6166 certifies US tax residency for treaty purposes.
- ISTS Inter-state transmission system
- India's national grid between states. Solar plants commissioned by 30 June 2025 keep a full waiver of its charges.
- JBIC Japan Bank for International Cooperation
- Japan's state-owned policy bank. It lends to and guarantees overseas projects and acquisitions by Japanese companies.
- JCM Joint Crediting Mechanism
- Japan's bilateral carbon-credit programme. India joined in August 2025.
- JMR Joint meter reading
- The monthly meter reading taken together by the plant and the buyer of power. It is the basis for each invoice.
- KYC Know your customer
- Identity, ownership and source-of-funds checks required by anti-money-laundering rules before a transaction.
- LPS Rules Late Payment Surcharge Rules 2022
- Indian rules that charge utilities interest on late payments to generators and can restrict their power purchases if they keep defaulting.
- MNRE Ministry of New and Renewable Energy
- The Indian ministry responsible for solar, wind and other renewable energy policy and schemes.
- MVA Megavolt-ampere
- The rating of transformers and other grid equipment. For a solar plant's power transformer it is close to the plant's MW capacity.
- NDA Non-disclosure agreement
- A confidentiality agreement. Investors accept one for each plant before seeing its details.
- NDC Nationally determined contribution
- A country's climate commitment under the Paris Agreement.
- NEXI Nippon Export and Investment Insurance
- Japan's state-owned export credit agency. It insures Japanese companies' overseas investments against political risks such as expropriation and currency transfer restrictions.
- NTPC NTPC Limited
- India's largest power generator, government-owned. It also buys renewable power under long-term contracts.
- O&M Operations and maintenance
- Running and maintaining a plant: cleaning, inspections, repairs, spares and performance monitoring.
- P50 / P90 Generation estimates by probability
- P50 is the yearly generation a plant is expected to exceed half the time; P90 is the level it should exceed nine years in ten. Lenders size debt on P90.
- PAN Permanent account number
- India's tax identification number. Non-residents without one may face higher withholding tax.
- PIB Press Information Bureau
- The Government of India's official agency for press releases. We cite it for government figures and announcements.
- PM Surya Ghar Pradhan Mantri Surya Ghar Muft Bijli Yojana
- The government scheme subsidising rooftop solar on homes, aiming to cover one crore (10 million) households.
- PM-KUSUM Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan
- A government scheme for solar on farms: solar pumps and small solar plants on or near farmland selling power to state utilities.
- PPA Power purchase agreement
- A long-term contract, typically 25 years in India, under which a buyer agrees to purchase a plant's electricity at a fixed tariff.
- Press Note 3 Press Note 3 (2020) of the FDI policy
- The rule requiring government approval for investment where the investor or a beneficial owner is from a country sharing a land border with India.
- PV Photovoltaic
- Technology that turns sunlight directly into electricity. Almost all Indian solar plants use PV panels.
- RBI Reserve Bank of India
- India's central bank. It administers foreign-exchange rules, including reporting of foreign investment.
- REC Renewable Energy Certificate
- A tradeable certificate for each MWh of renewable power. Utilities and companies buy them to meet renewable purchase obligations, so plants selling power without a fixed-tariff PPA can earn extra income from them.
- RPO Renewable purchase obligation
- The share of electricity that utilities and large consumers must buy from renewable sources.
- SARS South African Revenue Service
- South Africa's tax authority. Individuals investing abroad above the annual discretionary allowance need its tax compliance clearance.
- SEBI Securities and Exchange Board of India
- India's securities market regulator. It regulates investment advisers, brokers, funds and public offers of securities.
- SECI Solar Energy Corporation of India
- A government company that runs national renewable auctions and buys power from plants under long-term PPAs, backed by payment security.
- SFDR Sustainable Finance Disclosure Regulation
- EU rules requiring investment funds to disclose sustainability information about their investments.
- SPV Special purpose vehicle
- A company set up to own one plant or project. Buying a plant usually means buying its SPV's shares.
- TRC Tax residency certificate
- A certificate from your home tax authority confirming where you are tax resident, needed for treaty tax rates in India.