Scaling Solar Power for Irrigation in India

This report evaluates the implementation of the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme in India, specifically focusing on Component A (decentralized solar plants) and Component C-FLS (feeder-level solarization). While the scheme aims to add 35 GW of solar capacity by March 2026 to improve irrigation and farmer income, it has faced low uptake, achieving only 7% of targets for Component A and 34% for Component C-FLS as of December 31, 2025. The report identifies critical barriers including poor institutional coordination, grid instability, land acquisition challenges, and tariff mismatches, while providing actionable recommendations for the design of future solar irrigation programs.

• As of December 31, 2025, PM-KUSUM Components A and C-FLS have significantly underperformed against their targets, with Component A achieving only 7.2% (720 MW commissioned out of 10 GW sanctioned) and Component C-FLS achieving 33.73% (over 11.9 lakh pumps solarized out of 35.6 lakh sanctioned).
• The scheme provides measurable economic benefits: farmers leasing land for solar plants earn an average of INR 30,000 per acre annually, while those investing in plants see an estimated return on investment (ROI) of 11% to 16%.
• Solarization of agricultural demand offers substantial savings for states and distribution companies (DISCOMs) by reducing power purchase costs. For example, Rajasthan is projected to save INR 2,543 crores over 25 years (NPV basis) by solarizing 10% of its demand, which equals 12.47% of its FY 2022–23 agricultural subsidies.
• PM-KUSUM has generated significant rural employment, with estimates suggesting 4.32 full-time equivalent jobs per MW, totaling approximately 31,872 jobs created to date under Components A and C-FLS.
• A primary implementation barrier is the 'new business model' of PM-KUSUM, where plant sizes are too small for utility-scale developers to achieve economies of scale but too large for rooftop solar developers, increasing logistical costs per megawatt.
• Tariff viability is hindered by a mismatch between State Electricity Regulatory Commission (SERC) assumptions and market realities regarding capital costs, O&M costs, land lease rent, and grid availability.
• Grid infrastructure in rural areas is often too weak to support decentralized solar, leading to frequent voltage fluctuations, trippings, and reverse power flow during non-irrigation seasons, which reduces generation and developer revenue.
• Land identification and Right of Way (RoW) for evacuation infrastructure are major bottlenecks due to outdated land records, restrictive leasing laws (often limited to 5–7 years), and cumbersome land-use diversion processes.
• There is a critical lack of awareness among farmers; a survey in Karnataka found that 61% of farmers were unaware of the scheme, and only 3% had comprehensive knowledge of all components, partly due to non-intuitive naming (e.g., 'Component A').
• Institutional coordination is poor, as targets are often imposed on DISCOMs without their involvement in the design phase, leading to a lack of ownership and operational inefficiencies such as billing delays and poor outage management.
• Policy instability, including sudden changes in basic customs duty (BCD) and domestic content requirements (DCR), has led to project unviability, bid withdrawals, and tender cancellations.

APA

International Institute for Sustainable Development (2026). Scaling Solar Power for Irrigation in India. https://www.iisd.org/system/files/2026-04/scaling-solar-power-irrigation-india.pdf

Chicago

International Institute for Sustainable Development. Scaling Solar Power for Irrigation in India. 2026. https://www.iisd.org/system/files/2026-04/scaling-solar-power-irrigation-india.pdf.

Wikipedia

{{cite report |author=International Institute for Sustainable Development |title=Scaling Solar Power for Irrigation in India |date=April 2026 |url=https://www.iisd.org/system/files/2026-04/scaling-solar-power-irrigation-india.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{internationalinstituteforsustainabledevelopment2026scaling, author = {{International Institute for Sustainable Development}}, title = {{Scaling Solar Power for Irrigation in India}}, institution = {International Institute for Sustainable Development}, year = {2026}, month = apr, url = {https://www.iisd.org/system/files/2026-04/scaling-solar-power-irrigation-india.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }