Buying an Operating Solar Plant in India: Complete Guide
Last updated 18 October 2026 · By Pradeep Kumar, India Solar
Why buy a plant that is already running
Most losses in Indian solar happen before a plant switches on: land acquisition, permits, grid connection and construction. An operating plant has passed those stages. It earns from the day you buy it, and it has a record you can check: monthly joint meter readings, invoices and the dates the buyer of power actually paid.
The trade-off is price. Sellers charge for the risk already removed, so running plants often change hands close to the cost of building new. Your return depends mostly on paying the right price.
Types of plant by buyer of power
| Buyer of power | Typical tariff | Payment security | Main risk |
|---|---|---|---|
| Central agency (SECI, NTPC) | ₹2.4–2.9/kWh for recent auctions | Letter of credit, payment security fund, Centre–state–RBI tripartite agreement | Lower tariff; deviation charges |
| State utility (DISCOM) | ₹2.7–3.5/kWh, higher for older PPAs | Letter of credit or escrow; depends on the utility's finances | Late payment; renegotiation attempts on older high tariffs |
| Commercial and industrial buyer | ₹3.5–4.0/kWh | Corporate credit; deposits or guarantees | Buyer's credit; changes in open-access charges |
Tariffs are fixed in rupees for the PPA term, typically 25 years from commercial operation. The ranges above are typical figures seen in 2025–26 tenders and orders, not quotes for any plant.
What decides the price per MW
- Tariff and years left on the PPA: a ₹2.55 plant with 23 years left and a ₹5 plant with 15 years left are very different assets.
- Actual generation against the expected (P50) figure, from meter data, not the seller's forecast.
- How fast the buyer of power pays, and any unpaid invoices.
- Plant condition: module degradation, inverter age, hotspots found in thermal scans.
- Land: a registered lease that runs longer than the PPA.
- Existing debt and whether the lender will consent to a change of owner.
Recent reference points (as reported): ReNew sold about 1.4 GWp to RPSG's Purvah at an enterprise value of about ₹3.47 crore per MWp in August 2026, and the median for Indian operating solar deals since 2023 is about USD 0.48 million per MW according to Enerdatics. Small plants and older vintages trade differently.
The deal, step by step
- Introduction and KYC: identity, beneficial owners and source of funds.
- Mandate: size, buyer of power, state, tariff range and target return.
- Shortlist: plants screened against the mandate, with meter, payment and land records.
- Diligence: independent engineer, legal and land review, tax review, payment history, contract consents.
- Signing and closing: share purchase agreement, valuation certificate at or above fair value, consents from the power buyer and lenders where the contracts require them.
- After closing: RBI form FC-TRS within 60 days of the transfer, then operations, compliance and reporting.
Buying the shares keeps the PPA, approvals and land lease inside the company. Buying the assets instead (a slump sale) usually means transferring or re-signing contracts and approvals, which is slower and needs more consents.
Risks to price in
- Late payment by the buyer of power. The Late Payment Surcharge Rules 2022 cut legacy utility dues sharply, but delays still happen.
- Lower generation from soiling, degradation, grid outages or curtailment.
- Deviation charges for plants that must forecast and schedule output.
- Currency: income is in rupees. The rupee has weakened about 3.7% a year against the US dollar on average over the last 10 and 20 years.
- Contract and regulatory change, including attempts to renegotiate older high tariffs.
Sources
General information only, not investment, legal or tax advice. Rules change and depend on your circumstances; take advice before you act. India Solar does not offer securities or guarantee returns.