Free Solar!! Few policy areas in India have evolved as quickly—or as ambitiously—as the nation’s solar-energy programmes. What began as scattered pilot projects in the early 2010s has matured into a multilayered policy ecosystem designed to put photovoltaic panels on rooftops, pumps in farmers’ fields, and gigawatts of clean power into the grid. With a stated national target of 500 GW of non-fossil capacity by 2030, solar schemes have become the spine of India’s energy transition, channelling subsidies, concessional finance, and market certainty toward every segment of society.
Why dedicate special schemes to solar power?
Solar energy enjoys several innate advantages in the Indian context: abundant irradiation, falling module prices, and the modularity that lets a single kilowatt serve a household or thousands of megawatts feed a metro. Yet even as tariffs have tumbled below ₹2.50 /kWh in utility-scale bids, up-front capital costs remain a hurdle for households and small enterprises. Purpose-built schemes bridge that gap. By aggregating demand, funnelling subsidies, and standardising technical norms, they accelerate deployment while creating jobs and slashing import bills for coal and LNG. Policymakers now treat solar incentives not merely as climate tools but as instruments of welfare, rural development, and industrial policy.
PM Surya Ghar: Muft Bijli Yojana—rooftop solar for a crore homes
Announced on 15 February 2024, the PM Surya Ghar: Muft Bijli Yojana targets one crore residential rooftops with the promise of up to 300 units of free electricity every month. Households installing 1–3 kW systems receive a 40 % capital subsidy, disbursed through a national portal that integrates vendor empanelment, net-metering approvals, and direct-benefit transfer. The government estimates cumulative savings of ₹15,000–18,000 a year for a typical 2 kW system, a payback period of roughly four years—even faster in states with steep retail tariffs.
The portal (pmsuryaghar.gov.in) publishes transparent subsidy slabs: ₹30,000 per kW for the first 2 kW and ₹18,000 per extra kW up to 3 kW, capping the grant at ₹78,000. By standardising rates nationwide, the scheme removes the postcode lottery that dogged earlier state subsidies, and by routing payments straight to beneficiaries it reduces contractor-driven inflation.
PM-KUSUM—sun-powered irrigation and decentralised generation
For India’s 145 million farmers, unreliable grid supply and costly diesel pumps have long constrained productivity. The Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) tackles both problems with three components:
- Component A: 10 GW of decentralised, grid-connected solar plants (up to 2 MW each) on wasteland;
- Component B: 1.4 million stand-alone solar pumps (up to 7.5 HP); and
- Component C: 1.5 million grid-connected pumps that feed excess power back to distribution companies.
Backed by ₹34,422 crore of central assistance and extended to March 2026, PM-KUSUM has so far installed 5.4 lakh pumps—42 % of its target—while crowding in state and farmer contributions. Early impact evaluations show net incomes rising ₹50,000–₹75,000 a year where solar pumps replace diesel, and discoms benefiting from avoided daytime feed-in tariffs.
Rooftop Solar Phase II—subsidies for group housing and civic amenities
Parallel to Surya Ghar, the Phase II Rooftop Solar Programme (launched in 2019 and revamped in 2022) underwrites larger systems for resident welfare associations and municipal infrastructure—street-lights, waterworks, even metro stations—at the same ₹78,000 cap per consumer group. States such as Tamil Nadu and Gujarat layer additional incentives that shave another 10–15 % off capital costs. The national portal’s end-to-end workflow—application, site survey, installation, inspection, subsidy release—has shortened average commissioning time from six months to fewer than 45 days.
From schemes to scale: utility-scale parks and battery hybrids
While household and agricultural schemes democratise access, utility-scale solar parks drive volume. Under the Solar Park and Ultra-Mega Solar Power Projects scheme, India had approved 50 parks (37 GW) by late-2024, often paired with wind and battery storage to iron out intermittency. The recently announced Integrated Clean Energy Policy (ICE) extends this template: Andhra Pradesh’s Bethapalli complex will blend 1.8 GW of solar, 1 GW of wind and 2 GW of batteries, backed by ₹22,000 crore of investment. Such hybrids qualify for the Ministry of Power’s 2023 guidelines that waive interstate transmission charges for projects commissioned by June 2028, lowering delivered costs for corporate buyers.
International comparisons: how India stacks up
Countries worldwide woo solar with tax credits (United States’ Inflation Reduction Act), feed-in tariffs (Germany’s EEG), or contracts-for-difference (UK’s CfD). India’s approach is distinct on three counts:
- Demand-side subsidies instead of revenue subsidies: By covering 30–40 % of capex upfront, India side-steps long-term budget liabilities that plagued European FITs.
- Integration with rural-development goals: PM-KUSUM’s pump component simultaneously cuts diesel imports and groundwater depletion—something few OECD programmes attempt.
- Digital portals and DBT: The national rooftop portal echoes the JAM trinity (Jan Dhan–Aadhaar–Mobile) playbook, leveraging Aadhaar authentication for seamless fund transfer.
That said, India lacks the generous manufacturing tax credits of the US or the high-priced CFDs of Western Europe, which could slow the shift from imported modules to domestic production unless the Production-Linked Incentive (PLI) scheme scales further.
Challenges on the path to 500 GW
- Financing small systems: Even after subsidy, a 3 kW rooftop plant costs ₹2 lakh—steep for lower-income households without easy access to collateral-free loans.
- Distribution-company inertia: Many discoms fear revenue erosion from net-metering and delay approvals. Performance-linked grants now penalise states that breach the 20-day approval norm, but enforcement varies.
- Supply-chain concentration: Over 60 % of India’s modules still come from East Asia. While PLI has allocated funds for 55 GW of integrated manufacturing, ramp-up timelines are tight.
- Quality assurance: Sub-par inverters and poor installation practices can shave 5–7 % off annual yields. The Bureau of Indian Standards is extending compulsory certification to connectors and cables in 2025, but on-ground inspection capacity must keep pace.
Outlook: schemes as stepping-stones to a solar nation
With 223 GW of non-fossil capacity already commissioned and bids in the pipeline for another 169 GW, India remains broadly on-track to meet its 2030 pledge. Solar will shoulder at least half that load, aided by the mutually reinforcing architecture of Surya Ghar (rooftops), PM-KUSUM (agri-decentralised), and park-scale hybrids. The upcoming Green Hydrogen Mission further deepens the market by creating demand for round-the-clock renewable power, while state-level policies—ranging from feed-in bonuses in Kerala to virtual-net-metering in Delhi—keep the competitive pressure alive.
Conclusion
Solar schemes are more than budget line-items; they are social contracts that promise cleaner air, cheaper electricity, and livelihoods in sunrise industries. Surya Ghar empowers urban households to slash power bills, PM-KUSUM frees farmers from diesel’s grip, and mega-parks anchor India’s industrial decarbonisation. The road ahead will test bureaucratic agility, grid flexibility, and domestic manufacturing prowess, but the direction of travel is unmistakable: a future in which every Indian, whether in a city apartment or a remote hamlet, can tap the sun’s bounty. By aligning climate ambition with welfare imperatives, India’s solar schemes offer a compelling blueprint for emerging economies chasing growth that glows green.