New Guidelines for PM-Surya Ghar – Muft Bijli Yojana

January 15, 2025

The PM-Surya Ghar – Muft Bijli Yojana was launched on February 15, 2024, by Prime Minister Narendra Modi. This initiative aims to promote the adoption of rooftop solar systems in the residential sector across India. The Ministry of New and Renewable Energy (MNRE) has released operational guidelines to facilitate the scheme’s implementation. These guidelines introduce two innovative models for rooftop solar installations, enhancing accessibility and affordability for households.

Scheme Objectives

The primary goal of the PM-Surya Ghar scheme is to provide free electricity to households in India. The programme aims to benefit approximately 1 crore households, reducing electricity costs for the government. It is projected that the scheme will save the government ₹75,000 crore annually in electricity expenses.

Implementation Models

The scheme offers two main models for installing rooftop solar systems: 1. RESCO Model – Under this model, third-party entities invest in rooftop solar installations. Consumers only pay for the electricity they consume, eliminating upfront costs. 2. Utility-Led Aggregation (ULA) Model – This model involves Distribution Companies (DISCOMs) or state-designated entities installing rooftop solar systems on behalf of households. This approach simplifies the process for consumers.

Financial Mechanisms

A ₹100 crore corpus fund has been established for the Payment Security Mechanism (PSM) to minimise investment risks associated with the RESCO model. This fund may receive additional support through grants and other sources, subject to MNRE approval. The scheme also offers a Central Financial Assistance (CFA) component, providing a subsidy of up to 60% for 2 kW systems and 40% for systems between 2 to 3 kW.

Subsidy Structure

The subsidy structure under the PM-Surya Ghar scheme is as follows: – 2 kW System – ₹60,000 subsidy – 3 kW System – ₹78,000 subsidy The CFA is capped at 3 kW, ensuring households receive substantial financial support for their installations.

Financing Options

Households can access collateral-free, low-interest loans for the installation of rooftop solar systems. Current interest rates are around 7%. This financial support encourages more households to invest in renewable energy solutions.

Application Process

To apply for the subsidy, households must use the national portal (https://www.pmsuryaghar.gov.in/). The portal assists consumers in selecting suitable vendors, determining appropriate system sizes, and calculating potential benefits. It serves as a comprehensive resource for households considering rooftop solar installations.

PM-Surya Ghar aims to reach 1 crore households.
RESCO stands for Renewable Energy Service Company.
ULA involves DISCOMs for installations.
The scheme was launched in February 2024.
₹100 crore is allocated for Payment Security Mechanism.

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