PM Surya Ghar Agreement Format: What You Sign With Your Vendor, Clause by Clause

Two agreements come with a PM Surya Ghar installation, and most people only notice the second one. The net metering agreement with the DISCOM is signed at inspection and is largely standard. The agreement with your vendor is signed at the start, sets the price, the payment schedule and five years of obligations, and is the only document that protects you if the vendor lets you down.

MNRE publishes a model version of that vendor agreement as Annexure 2 to the scheme guidelines. It is a good floor. It is not the whole contract you should sign.

This guide reads the model agreement clause by clause, then covers what it leaves to you to add.

Key takeaways

• The model agreement is MNRE's Annexure 2, a suggested draft between consumer and vendor. The guidelines say the actual agreement may vary case by case.
• It binds the vendor to 5 years of comprehensive maintenance from the date the DISCOM commissions the system, with a system warranty for the same period.
• Modules and their cells must be made in India, and both modules and inverters must meet MNRE specifications.
• The plant must reach a 75 percent performance ratio at commissioning and hold it for the 5-year warranty.
• Price and payment terms are left blank. You write them in, and a milestone-based payment schedule is explicitly allowed.
• MNRE and the DISCOM are not parties. Any dispute is between you and the vendor, so the agreement is your protection.

The two agreements in a PM Surya Ghar installation

Consumer and vendor. Signed before installation. Covers design, supply, installation, commissioning, 5-year maintenance, warranty, price and payment. The model is Annexure 2 of the guidelines.

Consumer and DISCOM. Signed at inspection. The net metering agreement sets out how your exported and imported units are settled. A model is at Annexure 4 of the guidelines, but each state's regulations decide the actual terms. In Tamil Nadu this is handled with TANGEDCO during the net metering application.

The rest of this guide is about the first one, because it is the one you negotiate.

What you undertake as the consumer

The model agreement lists six obligations on the consumer, the "first party":

Submit the online application on the National Portal, including the net metering and inspection applications, and upload the documents.

Store the delivered material securely until the system is handed over.

Give access to the roof for installation, maintenance, testing and meter reading.

Provide electricity during installation and water for cleaning the panels.

Report any malfunction to the vendor during the warranty period.

Pay as per the agreed payment schedule, including any agreed extra work needed because of the building's condition.

None of these is onerous, but item 6 matters: extra work for structural customisation is billed on top of the standard price, so ask for it to be estimated in writing before you sign.

What the vendor undertakes

The vendor, the "second party", takes on the substantive work. In order, the model agreement requires:

• Standards - Vendor obligation: Follow state regulations and MNRE technical standards, or face blacklisting and penalties
• Site survey - Vendor obligation: Survey, detailed project report, roof strength and shadow-free area; extra work estimated and invoiced separately
• Design - Vendor obligation: Drawings and components to DISCOM, regulator and MNRE standards
• Modules and inverter - Vendor obligation: Modules including their cells manufactured in India; modules and inverters to MNRE specifications, star labelling and quality control orders
• Procurement - Vendor obligation: Complete system to BIS, IS or IEC standards
• Installation - Vendor obligation: Civil, structural and electrical work to safety and BIS standards
• Documentation - Vendor obligation: Catalogues, warranty cards, BIS and IEC reports, serial numbers, layout, wiring diagram, structure design
• Completion report - Vendor obligation: Help filling and uploading the signed project completion report
• Warranty - Vendor obligation: Whole system warranted for 5 years from DISCOM commissioning; help claiming manufacturer warranties

• Net meter and grid - Vendor obligation: Net meter supply, testing, approvals and grid connection
• Commissioning - Vendor obligation: Present at DISCOM testing and commissioning
• Maintenance - Vendor obligation: 5 years of comprehensive operation and maintenance, including overhauling and wear and tear
• Insurance - Vendor obligation: Insurance of material before commissioning
• Performance - Vendor obligation: 75 percent performance ratio at commissioning, maintained for 5 years
• Subsidy documents - Vendor obligation: All documents provided, with help uploading them for the subsidy

Two of these are worth underlining. The performance ratio clause is the closest the agreement comes to a generation guarantee: the vendor must bring a calibrated radiation sensor to commissioning and keep the plant at 75 percent for five years. And the module clause is what protects your subsidy: panels built from imported cells disqualify the whole system.

What the model agreement leaves blank

The model leaves the commercial terms to you and the vendor. Clause 15 says the cost and payment schedule should be mutually decided, and that you may opt for milestone-based payment. Clause 19 is an empty space headed "mutually agreed terms of payment".

That space is where most disputes start. Before signing, write in:

• The total price and what it includes, item by item: panel make and model, inverter make and model, structure type and height, cable, earthing, lightning arrester, net meter.
• A milestone payment schedule, for example a booking amount, a payment on delivery of material, a payment on installation, and the balance after DISCOM commissioning.
• A completion date, and what happens if it is missed.
• Who handles the portal steps. The model makes you responsible for the application; many vendors do it on your behalf. Put it in writing either way.
• Response time for maintenance calls during the 5 years.
• Roof waterproofing responsibility, because leaks are a workmanship matter. Our guide to solar panel roof leakage explains why.

The DCR undertaking

Alongside the agreement, the vendor provides documents showing the modules are DCR compliant: manufactured in India from Indian-made cells, and on MNRE's approved list. The guidelines are blunt that non-DCR modules "in any form" make the installation ineligible for the subsidy.

Ask for the module model number and the DCR documentation before installation, not after. Check the model yourself. Our brand guides, such as Waaree and Tata Power Solar, explain how to read a module listing.

When things go wrong

The model agreement's dispute clause says disputes must be settled mutually or as per law, and that MNRE and the DISCOM will not be parties. The disclaimer at the foot of the model repeats it.

That is why the commercial terms you add matter so much. A milestone schedule means you have not paid the balance when a problem appears. A written completion date gives you something to enforce. For the grievance route through the National Portal, see our guide to raising a PM Surya Ghar complaint.

Frequently asked questions

Is the PM Surya Ghar agreement format mandatory?

The guidelines provide it as a suggested sample and say the actual agreement may vary case by case. Most vendors use it as the base. Treat its obligations as the minimum and add the commercial terms.

Where can I download the PM Surya Ghar model agreement?

It is Annexure 2 of MNRE's guidelines for the Central Financial Assistance to Residential Consumers component, available on the MNRE website and the National Portal.

What warranty does the PM Surya Ghar agreement give?

The whole system is warranted for 5 years from DISCOM commissioning, with 5 years of comprehensive maintenance. Individual component warranties from the manufacturers, usually longer for panels, are passed to you.

Does the agreement guarantee how much electricity I will get?

Not in units. It requires a 75 percent performance ratio at commissioning, maintained for 5 years, which is a measure of how efficiently the plant converts available sunlight.

Can I change vendor after signing the agreement?

Before installation, usually yes, subject to what you agreed about the booking amount. After installation the application is tied to that system, and a disagreement becomes a dispute between you and the vendor.

Who pays for extra structural work?

You do, but the vendor must estimate it and invoice it separately. Ask for the estimate in writing before signing.

Is the net metering agreement the same as the vendor agreement?

No. The net metering agreement is between you and the DISCOM, signed at inspection, and sets how your units are settled.

Where this fits

For choosing the vendor you will sign with, see the PM Surya Ghar vendor list. For the documents the subsidy needs, see documents required for solar subsidy. For the full scheme, see the PM Surya Ghar subsidy guide.

Blues Renewables uses the MNRE model agreement as the base of every PM Surya Ghar contract and adds the terms above in writing: named components, a milestone schedule and a completion date. If you have a vendor's agreement in front of you and want a second opinion, send it over.

Call +91 98841 07170.

Sources

• Ministry of New and Renewable Energy, Guidelines for PM-Surya Ghar: Muft Bijli Yojana, Annexure 2, Model Draft Agreement between Consumer and Vendor, clauses 1 to 19 and the disclaimer
• Ministry of New and Renewable Energy, Guidelines for PM-Surya Ghar: Muft Bijli Yojana, on finalisation of terms, DCR modules, meter installation and the model net metering agreement at Annexure 4