Most solar payback calculations in Sri Lanka are still built on numbers that have been revised three times since 2024 — and the most recent revision is four days old.
The old sum was simple. Take the system cost, divide by the annual value of the electricity it generates, and you have your payback period in years. When every unit was worth the same — whether you used it or sold it — that arithmetic held. It does not anymore.
Three things have changed at once, and they pull in different directions. Understanding how they interact is the difference between a business case that survives contact with reality and one that quietly underdelivers for twenty years.
Change one: export rates now move on a six-month clock
Feed-in rates for new rooftop agreements were cut in July 2024, restructured into tiers in June 2025, and re-banded again on 25 August 2026. The current schedule runs:
- Up to 10 kW — Rs. 23.11
- Above 10 kW to 40 kW — Rs. 19.15
- Above 40 kW to 250 kW — Rs. 17.11
- Above 250 kW to 1 MW — Rs. 15.81
- Above 1 MW — Rs. 15.81
The August revision moved commercial rates modestly upward — a 200 kW system earns Rs. 17.11 against Rs. 15.49 under the previous tiers, about 10.5% better. That is welcome, but it is not the important part.
The important part is printed on the schedule itself: it is valid until 24 February 2027. Three revisions in twenty-five months, and an explicit six-month validity window, tell you the export rate is now a variable that moves roughly twice a year.
Set against that, one rule has not changed: whatever rate applies when your Power Purchase Agreement is signed is fixed for the full twenty-year term. Existing agreements are untouched.
Put those two facts together and you get the single most useful conclusion in this article. The month you sign determines what you earn for two decades — and no payback model should assume the export rate will hold. Build the case on what you save, not on what you sell.
Change two: what you save from self-consumption rose
Retail electricity moved the opposite way. Rates increased on 1 April 2026, and again on 11 May 2026 in an extraordinary revision. The May schedule is the one currently in force — Q3 2026 was left unchanged.
For industrial consumers on a time-of-use tariff at 400/230 V with contract demand under 42 kVA, the current structure looks like this:
- Peak — 18:30 to 22:30 — Rs. 78.00
- Day — 05:30 to 18:30 — Rs. 39.00
- Off-peak — 22:30 to 05:30 — Rs. 19.00
The day rate is the one that matters for solar, because that is when your system generates. At Rs. 39.00, a unit you consume yourself is worth about 2.3 times what the same unit earns exported from a 40–250 kW system, and about 2.5 times for a system above 250 kW.
That ratio is now the central fact of solar economics in Sri Lanka. It did not exist in 2022, when export at Rs. 37.00 was competitive with almost any retail rate. And unlike the export rate, it is not on a six-month clock — retail rates have risen repeatedly, which means this half of the equation grows over time.
Change three: export is no longer guaranteed
This is the change least often priced into proposals, and it is the one that has cost developers real money.
CEB began curtailing solar generation in February 2025 under what became known as “Sunny Sunday” — asking systems offline on days when demand is low and solar output is high. By January 2026 this had expanded beyond Sundays to public holidays and weekdays, with three days a week reported. Solar firms have put the industry cost at around Rs. 2 billion, roughly 15% of revenues. No compensation is paid.
In June 2026, CEB asked owners of rooftop systems of 300 kW and above to disconnect during the Poson holiday period, citing oversupply and frequency stability.
The practical consequence for a commercial buyer: a payback model that assumes you will export every surplus unit, every day, for twenty years is modelling something that is not happening. Self-consumed units carry no such risk — nobody can curtail electricity that never touches the grid.
So how do you actually calculate payback now?
Four inputs, in order of how much they move the answer.
- Your self-consumption ratio. What percentage of generation your building absorbs directly, rather than exporting. This is now the single biggest lever on payback, and it is determined by your load profile, not by your equipment. A two-shift factory might absorb 80–90% of its solar directly. An office that empties at five might absorb half that.
- Your day-rate tariff. What you actually pay per unit during generating hours. Every self-consumed unit saves you this. Check your own bill rather than assuming — the rate depends on your category and connection voltage.
- Your export band. From the schedule above, set by system size, fixed for twenty years once signed — and set by the schedule in force on the day you sign.
- System cost. Still relevant, but no longer the dominant variable it once was. Two identical systems on two different buildings can have payback periods years apart purely because of input one.
The sum becomes: annual saving equals (units self-consumed × your day rate) plus (units exported × your export band), minus operating and maintenance costs. Divide the system cost by that figure, and adjust for the fact that retail rates have risen repeatedly while your export rate is frozen — which means the self-consumption half of that equation grows over time and the export half does not.
What this changes about system design
The logic that produced the best return in 2022 produces a worse one now.
Sizing. Filling the roof used to be right because every surplus unit found a buyer at a good price. Now, sizing against your daytime load and accepting a smaller system can produce a shorter payback than a larger one — particularly for buildings whose consumption does not match their roof area.
Load shifting. Moving discretionary daytime loads into generating hours is free money under the new structure. Scheduling a process to run at 11am rather than 8pm converts a Rs. 78.00 peak unit into a self-consumed one.
Storage. Two separate cases now exist, and the August 2026 decision created the second one. Behind the meter, shifting solar into the 18:30–22:30 peak window is worth Rs. 78.00 against Rs. 39.00 during the day. And for the first time there is also an approved export rate for rooftop solar paired with battery storage — Rs. 45.53 per unit during priority periods for the first fifteen years on a new system, against Rs. 17.11 for plain daytime export. Whether either pays back depends entirely on your load shape, but storage has moved from an assumption to a calculation.
The honest summary
Solar in Sri Lanka still pays back. What has changed is that the payback period is now far more sensitive to your building than to the equipment on the roof — and that the export half of the calculation sits on a schedule that expires in February.
If a quotation gives you a payback figure without having seen twelve months of your bills, that number was produced by assumption, not calculation.
Get a payback figure based on your actual consumption
First Energy has designed solar for Sri Lankan factories, commercial buildings and utility-scale sites for a decade, through every one of these tariff changes. If you want a payback assessment built on your real load profile — including what self-consumption ratio your building can realistically achieve — get in touch for a site evaluation.
Sources: PUCSL rooftop solar PV tariff schedule effective 25 August 2026 · PUCSL Decision on Electricity Tariffs, May 2026 · PUCSL Rooftop Solar PV Connection Schemes · EconomyNext — Expanding ‘Sunny Sunday’ curtailment · Lanka Business Online — Q3 2026 tariffs unchanged.