India's Solar Push For Farmers Is Working. Ending PM-KUSUM Now Would Be a Mistake | OPINION
— By Priyami Dutta and Anas Rahman, International Institute for Sustainable Development
India is finally making headway in greening its agricultural power use, and solar-powered irrigation is at the heart of this shift. But just as momentum builds, a major risk looms: the central government's flagship PM-KUSUM scheme, which promotes the deployment of solar power for irrigation, is set to end in March 2026. Without swift action to extend the scheme, progress could stall or even unravel.
PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) has shown that decentralized solar can bring reliable, clean power directly to farmers while reducing the financial stress on India's electricity distribution companies (DISCOMs). By supporting decentralised solar plants near agricultural demand centers, the scheme minimizes transmission losses and infrastructure costs of utility-scale plants, and provides reliable daytime power for irrigation, replacing erratic grid supply and expensive diesel pumps.
And yet, despite its promise, only about 20% of the targeted capacity has been installed so far, reflecting on-the-ground challenges.
Hurdles like tariffs set too low to attract developers, difficulty in finding suitable land parcels, inadequate or unsuitable electricity distribution infrastructure, and limited experience with small-scale, decentralised solar models have hampered progress. In several states, tenders were delayed, cancelled, or revised due to poor developer response.
But that's starting to change. Maharashtra, for instance, issued Letters of Award (LOAs) for 15 GW of capacity in 2024–25, while other states tendered nearly 21 GW between October 2024 and April 2025 — a steep jump compared with 2023 (5.25 GW) and the first nine months of 2024 (11.75 GW).
Across the country, PM-KUSUM is emerging as a core part of how states plan to meet their renewable energy commitments. Notably, the cumulative LOAs under KUSUM now exceed those for utility-scale solar projects, signaling a decisive shift in state priorities toward agricultural solarization. The scheme is a key pillar in Madhya Pradesh's plans to add 2,500 MW of solar capacity annually in 2025–26 and 2026–27. Over 6 GW of capacity for feeder-level solarization under PM-KUSUM has already received tariff approvals in FY 2025, reflecting rapid progress towards actual deployment.
Just as this momentum builds, policy uncertainty threatens to derail it.
Many states assumed that projects with a signed power purchase agreement (PPA) before the scheme's end date of March 2026 would qualify for central support. But in a recent communication with Rajasthan, the Ministry of New and Renewable Energy stated that only projects commissioned by December 31, 2025, will be eligible. This timeline doesn't match reality. Given that projects typically take 12 to 18 months from tendering to commissioning, most current bids could become ineligible.
As a result, several states have paused or slowed their plans. Andhra Pradesh even issued tenders with and without central subsidy provisions. This reflects the confusion and increasing risk perception for developers.
To keep the momentum going, the central government should act quickly and clearly.
First, it can make all PPAs signed by December 2025 eligible for central subsidy, provided projects are commissioned within the stipulated timeframe.
Second, the policy update must be communicated promptly and unambiguously to all state agencies.
Third, the central government can build on the newfound momentum by announcing a comprehensive second phase of PM-KUSUM. A new and improved scheme would ideally include adjustments based on lessons from the past five years, with robust technical and financial support for states.
Fourth, the exchange of experiences, knowledge, innovation, and best practices among states can be actively facilitated, which could inspire and help aspirational states scale up PM-KUSUM initiatives.
Solarising irrigation is one of India's most cost-effective options for integrating renewable energy into its power mix—and it makes political sense, too. For a country where agricultural power is heavily subsidised and politically sensitive, PM-KUSUM offers a rare win-win-win: clean and affordable power for farmers, improved financial viability of DISCOMs, and real progress towards clean energy objectives.
States like Andhra Pradesh, Uttar Pradesh, Maharashtra, Telangana, Karnataka, Odisha, and Assam face major gaps in meeting their distributed renewable energy targets through 2035, according to the Central Electricity Authority's Long-term Distribution Licensee Resource Adequacy Plans (2024–2035) — roadmaps designed to help states ensure reliable and cost-effective power supply and avoid future shortages.
PM-KUSUM can help bridge these gaps, but only if the government provides policy clarity and consistent support to sustain the current momentum. This is not the moment to ease off; now is the time to double down.
(The author is a policy advisor and Anas Rahman a senior policy advisor for IISD's Energy programme.)
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