In India’s clean energy transition, the question for businesses is no longer whether to adopt solar, but rather how to do adopt it.
For many commercial and industrial (C&I) organisations, the decision is less about technology and more about capital strategy. The upfront investment required for solar photovoltaic (PV) systems often competes with other priorities such as capacity expansion, automation, digitalisation, or balance sheet optimisation. As a result, the choice between the CAPEX model solar and the OPEX model solar has become a strategic one, shaping energy costs, risk ownership, operational accountability, and long-term flexibility.
Having supported projects under both models at scale, Gentari has observed how this decision has evolved alongside policy shifts, market cycles, and changing business expectations.
Why the CAPEX vs OPEX decision matters more than ever
India’s rooftop and distributed solar market has grown steadily over the past decade. Industry data indicates that CAPEX-led installations continue to account for a significant share of cumulative installed capacity, while adoption of OPEX or Renewable Energy Service Company (RESCO) models has accelerated in the C&I segment, particularly among asset-light and multi-site businesses.
This divergence reflects a maturing maret. Organisations are becoming more deliberate about what they choose to own, what they outsource, and how capital is deployed. Understanding the CAPEX and OPEX models through this strategic lens is increasingly important.
Understanding the OPEX (RESCO) solar model
Under the OPEX model solar, also known as the RESCO model, the solar plant is developed, financed, owned, operated, and maintained by a third-party provider. The customer purchases electricity generated by the system through a long-term power purchase agreement (PPA).
In practice, the OPEX model aligns with how many businesses now approach infrastructure: asset-light, performance-linked, and predictable.
How the OPEX model works
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The solar system is installed at the customer’s site, while ownership remains with the developer
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The customer pays for electricity consumed on a per-unit basis
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Tariffs may be fixed or include defined escalation mechanisms
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Performance and uptime responsibility typically rests with the developer
Why businesses choose the OPEX model
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No upfront capital deployment
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Faster access to solar benefits
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Operations and maintenance managed by the provider
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Greater cost predictability and performance accountability
From a market perspective, the OPEX model has supported faster solar adoption among organisations operating from leased premises, expanding across multiple locations, or prioritising liquidity and speed of execution.
What to Consider
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Subsidies generally accrue to the asset owner
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Tariff structures may reflect long-term market assumptions
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Long-term asset value remains with the developer
Understanding the CAPEX solar model
In the CAPEX model solar, the organisation purchases and owns the solar system outright, either through direct capital expenditure or financing. The system is recorded as an asset on the balance sheet, and the owner retains control over generation and long-term value.
How the CAPEX model works
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The business funds the system upfront or through debt
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Ownership and asset risk remain with the customer
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Installation and O&M may be supported by service providers like Gentari
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Eligibility for applicable incentives or policy benefits, subject to regulations
Why businesses choose the CAPEX model
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Full asset ownership and value capture over time
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Access to government incentives where applicable
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Reduces exposure to tariff escalation after payback
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Strong long-term economics over a 20–25-year operating life
The CAPEX model is often preferred by organisations with stable balance sheets, long-term site tenure, and internal capability to manage owned infrastructure.
What to consider
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Higher upfront capital allocation
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Ongoing O&M responsibility unless contracted separately
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Performance risk largely sits with the asset owner
What the numbers indicate: Different growth paths
Market data shows that both models continue to grow, but in different ways:
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CAPEX remains prominent in owner-occupied facilities
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OPEX adoption is growing faster in the C&I segment, driven by scalability, standardisation, and risk transfer
This reflects how different organisations optimise for different outcomes, balancing cost of capital against certainty of performance.
How organisations typically choose between CAPEX and OPEX
In practice, the decision between the CAPEX and OPEX models often reflects broader business philosophy.
Organisations tend to prefer the CAPEX model solar when they:
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Have access to surplus or low-cost capital
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Seek maximum long-term benefits
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Operate from stable, long-term sites
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Are comfortable managing owned assets
They often prefer the OPEX model solar when they:
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Favour asset-light structures
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Requires faster deployment
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Operates across multiples sites
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Prioritise performance accountability over ownership
Many mature organisations now deploy both models in parallel, using CAPEX where ownership aligns with strategy and OPEX where flexibility and speed are more valuable.
Why the CAPEX vs OPEX distinction is becoming less binary
The traditional divide between the CAPEX and OPEX models is beginning to narrow.
Customers increasingly expect:
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Stronger performance assurances under CAPEX
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More integrated solutions under OPEX
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Storage, hybrid systems, and round-the-clock reliability under both models
This suggests that execution quality and operating discipline are becoming more important than financing structure alone.
From Gentari’s experience across both ownership models, one principle remains consistent: outcomes depend heavily on how projects are designed, executed, and operated over time.
Making the right choice for your business
When evaluating solar today, a more useful starting point than “CAPEX or OPEX?”, is asking:
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How should capital be deployed over the next 10–15 years?
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Where does ownership add value, and where does accountability matter more?
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How important are flexibility, scalability, and long-term performance assurance?
Both the CAPEX model solar and the OPEX model solar can deliver strong outcomes when structured and executed effectively. They key differentiator is selecting a partner with the experience to support either model consistently and transparently over the long term.
Speak to Gentari
If your organisation is assessing solar options and would like to evaluate CAPEX and OPEX models aligned with your business strategy, Gentari can support structured assessments, clear trade-offs, and tailored clean energy pathways.