Planning to go solar? One of the first financial decisions you’ll face is:
Should you invest upfront (CAPEX), or choose a zero-investment model (OPEX)?
Both models can make solar power affordable and sustainable — but they differ significantly in terms of ownership, financing, tax benefits, and long-term ROI.
At EKA Synergy Solar, we guide industries, institutions, and commercial clients across India in choosing the right model based on available capital, operational control, and long-term savings.
In this blog, we explain the difference between CAPEX and OPEX models in solar EPC projects — and which one delivers the best return on investment for your needs in 2025 and beyond.
Understanding CAPEX and OPEX in Solar EPC
1. CAPEX Model (Capital Expenditure)
Under the CAPEX model, the consumer pays 100% of the project cost upfront and owns the solar plant.
You reap the benefits of zero-cost electricity (post payback), tax incentives, and complete control of the asset.
Key Features:
- One-time investment in solar infrastructure
- Asset depreciation & MNRE subsidy eligibility
- No monthly payments or third-party control
- Higher ROI and faster breakeven
Best For: Industries, institutions, or homeowners with available capital and a long-term savings mindset.
2. OPEX Model (Operational Expenditure / RESCO Model)
In the OPEX model, a solar developer installs and maintains the system on your premises — and you only pay for the power you use, at a fixed rate under a Power Purchase Agreement (PPA).
Key Features:
- No upfront investment
- Power billed at a fixed rate (₹3 – ₹5 per unit)
- Developer handles system performance, insurance & O&M
- Typical contract duration: 10–25 years
Ideal For: SMEs, commercial setups, or startups preferring operational savings without asset ownership.
CAPEX vs OPEX – Key Differences at a Glance
| Aspect | CAPEX Model | OPEX Model (PPA) |
|---|---|---|
| Ownership | Consumer | Developer |
| Upfront Cost | High (One-time investment) | Zero (No initial capital) |
| Tariff per Unit | Free after payback | ₹3–₹5 (Fixed PPA rate) |
| ROI & Payback | 18–22% / 3–5 years | 8–12% via monthly savings |
| Maintenance | Owner or AMC (EPC) | Developer handles it fully |
| Tax Benefits | Eligible for depreciation & subsidy | Not available to consumer |
| Long-Term Savings | Very High (25+ years) | Limited to contract duration |
| Ideal For | Factories, institutions, homes | SMEs, leasing clients, startups |
ROI Comparison: CAPEX vs OPEX (2025 Scenario)
| System Size | Model | Estimated ROI (%/Year) | Payback Period | Monthly Savings (Approx.) |
|---|---|---|---|---|
| 100 kW Industrial | CAPEX | 18–22% | 4 years | ₹1.6 – ₹2.2 lakhs |
| 100 kW Industrial | OPEX | 10–12% (via PPA) | N/A | ₹1 – ₹1.2 lakhs |
| 500 kW Commercial | CAPEX | 16–20% | 5 years | ₹4 – ₹5 lakhs |
| 500 kW Commercial | OPEX | 8–10% | N/A | ₹2.5 – ₹3 lakhs |
Note: These figures are indicative. Actual ROI depends on site conditions, tariff, irradiance, and equipment quality.
How EKA Synergy Solar Optimizes ROI in Both Models
1. Precision Engineering
We use Helioscope, AutoCAD, and PVsyst simulations to design highly efficient solar systems — improving yield by up to 7–10% over conventional designs.
2. Tier-1 Procurement
All components are sourced from MNRE-approved Tier-1 brands, ensuring long-term durability and system efficiency with 25–30 year warranties.
3. Smart Monitoring
Our IoT-based remote monitoring systems allow clients to view energy output, fault alerts, and performance metrics in real time.
4. Financial Assistance & PPA Structuring
- CAPEX clients: Guidance on MNRE subsidies, accelerated depreciation (40%), and institutional financing.
- OPEX clients: Competitive PPAs tailored to reduce your LCOE (Levelized Cost of Energy) over time.
Which Model Delivers Better ROI for Your Business?
| Business Type | Recommended Model | Why? |
|---|---|---|
| Industrial Plants | CAPEX | High usage, tax benefits, and asset ownership |
| Commercial Complexes | OPEX / Hybrid | Cash-flow friendly with maintenance offloaded |
| Educational Institutions | CAPEX | Long-term cost savings, good for budgeting |
| Warehouses & SMEs | OPEX | Avoids upfront capex, stable cost per unit |
| Housing Societies | CAPEX | Shared cost model & zero-cost power post-payback |
Final Verdict: CAPEX or OPEX?
- Go for CAPEX if:
- You want maximum ROI and long-term savings
- You can leverage tax benefits
- You prefer full ownership & control
- Choose OPEX if:
- You want to avoid upfront investment
- You prefer hassle-free solar with maintenance covered
- You need predictable billing via PPA