Virtual net metering in Maharashtra: what the 2024 rules allow, and where they stand

Virtual net metering (VNM) is a billing arrangement that lets several electricity consumers share the output of one solar plant without being wired to it. The plant exports its energy to the grid through a generation meter or a net meter, and the DISCOM credits that energy to the participating consumers' bills in an agreed ratio. No wiring changes and no power moves to a particular flat. Only the numbers on the bills do.

Ordinary net metering is different. There, the plant sits behind one consumer's meter and offsets only that consumer's bill. That is why a society's common-area plant cannot help individual flats under ordinary net metering, and why VNM exists.

In Maharashtra, Regulation 2.1(z)(a) defines VNM as a modality in which a renewable energy system's exported energy "is adjusted in either one or more than one electricity service connection(s) of participating Residential consumers(s) situated in multi storied building of same housing society or apartment owners association including their common connection within the same Distribution Licensee's area of supply".

Maharashtra's virtual net metering rules are the MERC (Grid Interactive Rooftop Renewable Energy Generating Systems) (Second Amendment) Regulations, 2024 (PDF), notification No. MERC/Tech/Regulation/0537, published in the Maharashtra Government Gazette on 29 August 2024 and in force from that day. They amend MERC's 2019 rooftop regulations, which extend to the whole of Maharashtra, so they bind every DISCOM in the state. These are the clauses a housing society needs, in plain words.

Two caps are built in. Each participant's slice of the plant cannot exceed what that consumer could net meter alone, which MERC's rules tie to its sanctioned load or contract demand, and the whole plant is capped at the sum of those slices.

In a housing society, virtual net metering runs on one agreement, one Lead Person and one sharing ratio. The participating flats, and the society's common connection if it joins, nominate a Lead Person from among themselves. Under Regulation 4.5, the Lead Person signs the net metering agreement for everyone and handles all correspondence with the DISCOM.

The agreement lists every participant with a sharing ratio in per cent, starting with the Lead Person's own connection. Each month, the plant's exported energy is credited to each participant's bill in that ratio. Within a bill, consumption in a time-of-day block is first set against generation in the same block, and any surplus is treated as off-peak energy, or as normal-time energy for a consumer not on time-of-day tariffs. Credits a flat cannot use carry forward to its next bill.

A society can set the ratio any way its members agree, for example in proportion to what each flat paid towards the plant, and change it once a financial year on two months' notice through the Lead Person. An SPDU works differently: each flat's share is enforced by its own SPDU in the meter room and shown live in the Nova app.

Group net metering spreads one plant's surplus across several connections of the same consumer, while virtual net metering spreads it across different consumers. In Maharashtra, group net metering came first, in MERC's First Amendment of 2023 (Regulation 2.1(k)(c), gazetted on 16 November 2023), which adjusts surplus energy "in more than one electricity service connection(s) of the same consumer". Virtual net metering followed on 29 August 2024, for different residential consumers in one society's building. MNRE's national guidance of 23 February 2023 draws the same line, and leaves the final definition to each state's regulator.

For a housing society, the difference is who owns the connections. Connections in the society's own name, such as separate meters for lifts, pumps and common lights, belong to one consumer, so group net metering can spread one plant across them. Each flat is a separate consumer, so sharing a plant's credits across the flats' own bills needs virtual net metering. Both depend on MSEDCL processing applications. On 14 October 2025, MERC imposed a similar Section 142 penalty on MSEDCL in Case No. 45 of 2025, over group net metering and net metering up to 5 MW.

Not in practice. MSEDCL (Mahavitaran, often still called MSEB) has had an online VNM form since early 2025, but it is not approving VNM applications. It has challenged the regulations in the Bombay High Court, and MERC has penalised it for keeping applications pending.

• 3 December 2024: Brookhill CHS, Harmony Sky Suites CHS and Royce CHS file Case No. 222 of 2024 to have VNM enabled.
• 10 December 2024: MERC directs MSEDCL to make its VNM portal operational within 15 days.
• 9 September 2025: In Case No. 226 of 2024, MERC directs MSEDCL to process VNM applications in hard copy.
• 14 October 2025: MERC finds that MSEDCL "has kept the applications pending by siting [sic] procedural issues" and imposes a ₹1,00,000 penalty under Section 142 of the Electricity Act, plus ₹6,000 a day if the applications are not approved within 7 days.
• 31 October 2025: MERC calls it "deliberate non-compliance" and gives MSEDCL a last 7 days, failing which the penalty is to be recovered from the Chief Engineer responsible.
• 25 March 2026: After a fresh hearing, the case is reserved for order.

Virtual net metering does not keep the lights on in a power cut. It is a billing arrangement for a grid-connected plant, and a grid-tied inverter's anti-islanding protection switches it off when the grid fails, so that it never sends power into lines that DISCOM staff may be repairing. The flats get nothing from the plant until the grid returns.

The rules do make room for storage. The proviso to Regulation 2.1(z)(a) lets a housing society set up a grid-connected micro-grid "with or without storage" to serve several residential consumers or to optimise emergency diesel use. MERC's Statement of Reasons explains that a society micro-grid, with or without battery storage and integrated with a diesel generator, "will help in utilisation of Solar energy which otherwise cannot be utilised when supply from the Distribution Licensee is not available", and describes it as a society-level micro-grid "using virtual net-metering" (p. 8). In practice, a battery cannot be built into a VNM layout: the flats draw only from their own DISCOM meters, so there is no electrical path from a common battery to any flat.

Protostar Fusion takes a different path. Its shared solar plant and shared lithium battery bank never connect to the grid, so it needs no VNM and no net metering at all. Every flat gets a shared part of the solar plant and the battery bank through its own SPDU. No SPDU building has a battery yet. Fusion's hybrid storage stack is built and running in simulation.

Protostar Technologies Pvt. Ltd. was one of nine stakeholders who commented on the draft, listed fifth in Annexure-I of MERC's Statement of Reasons (p. 21), alongside MSEDCL, Adani Electricity Mumbai and the Government of Maharashtra. Its written submission, made during the public consultation that closed on 14 June 2024, is recorded in the Statement of Reasons.

Protostar argued that every flat could be powered by a hybrid system using one large common battery, since an export-only system wastes its generation during an outage (p. 6). It proposed settling energy at a common net meter for the building, with the electricity "allocated to each apartment via Energy Allocation Devices (EAD)/Smart Power Distribution Unit (SPDU)" (p. 7).

In the final regulations, MERC accepted a request, which Protostar's submission included, that where technically feasible one of a housing society's existing connections can serve as the net metering connection, with surplus adjusted against the other participants in a pre-specified ratio (p. 7). It also added the society micro-grid proviso after the consultation (p. 8). It did not accept Protostar's request to exempt the common connection from load enhancement (pp. 16 and 17). More on our impact page.

Virtual net metering is accounting, not distribution: it moves credits between bills after the fact, while an SPDU moves the power itself. One SPDU per flat, in the meter room, switches that flat's supply onto the shared plant, meters what the flat takes and moves it back to its own meter when its share is used, so the flat runs on its share in real time.

MERC's 2024 rules also allow a housing society to set up a grid-connected micro-grid "with or without storage" (proviso to Regulation 2.1(z)(a)), and that is the route Protostar takes. It does not need MSEDCL to do the energy accounting. MSEDCL net meters only the society's common connection, as for any rooftop plant, and each flat's SPDU measures and allocates that flat's share in hardware. This is the hardware-based approach Protostar put to MERC in its 2024 submission. Because the sharing happens in the meter room and not on the bills, the building can add one large common battery bank and share its stored energy flat by flat. VNM cannot do that. In a VNM layout the plant exports to the grid through its own meter and every flat stays on its own DISCOM meter, so the single-line diagram has no point where a common battery could supply the flats. Only the credits move between bills.

• Where the benefit shows: with VNM, as a credit on a bill. With an SPDU, as units that never appear on your flat's own meter.
• Power cuts: a grid-connected VNM plant gives a flat nothing during an outage. Protostar Fusion is designed to keep every participating flat running from its share of a shared battery bank.
• Evenings: VNM cannot allocate stored energy to a flat at 9 pm. Fusion is designed to store the day's sunshine for the evening.
• Paperwork: VNM needs the DISCOM to approve a multi-party agreement and fit a check meter. Protostar's grid-connected microgrid is net metered on the society's common meter, and Fusion needs no net metering at all.
• Changing shares: a VNM ratio changes once a financial year. An SPDU share can grow with panels added in your name, roof permitting, or by buying part of a neighbour's share.

As MSEDCL is not approving virtual net metering, a society that wants solar for its flats now needs another route. These are all available in Maharashtra today.

• Common-area solar on the common meter, under ordinary net metering, with PM Surya Ghar support for a society's common facilities.
• Members' own panels with their own net meters, if the terrace allows.
• A shared plant with an SPDU at every flat's meter. Protostar's grid-connected microgrid is net metered on the society's common meter, as in its Pune buildings since 2019, and it pauses in a power cut.
• Protostar Fusion: shared solar, a shared lithium battery bank and an SPDU per flat, built for whole-home backup. The plant never connects to the grid, so no net metering of any kind is involved.

Ordinary net metering has also become simpler. Under MERC's Practice Direction of 30 June 2026, the agreement a consumer accepts while applying online counts as the net metering agreement, so the DISCOM cannot insist on a separate physical one. Compare every option in our guide to solar for flats.