Introduction
Switching to solar can feel expensive at first, but thanks to the PM-KUSUM Ghar Yojana subsidy, farmers and rural households can save a big chunk of the cost. With the government covering up to 60% of installation expenses, solar irrigation and rooftop solar have become affordable and profitable.
In this guide, we’ll explain how the subsidy works, who is eligible, and how Solyug Renewables helps farmers benefit fully from PM-KUSUM.
What Is the PM-KUSUM Subsidy?
The subsidy is financial assistance from the government to reduce the upfront cost of solar pumps or solar power plants.
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Central Government Subsidy: 30%
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State Government Subsidy: 30%
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Farmer Contribution: 40% (can be financed via loans)
Tip: Some states offer extra incentives for small and marginal farmers, making the effective cost even lower.
Eligibility for Subsidy
To qualify, farmers must:
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Be a registered farmer or rural household owner.
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Own the land or have an existing pump for irrigation.
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Provide valid Aadhaar and bank details.
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Install the solar system through an MNRE-certified EPC company.
Pro Tip: Proper documentation ensures fast approval and subsidy transfer.
How the Subsidy Works
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Approval: Submit application online through state portals or MNRE.
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Installation: Certified EPC companies like Solyug Renewables handle design and setup.
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Verification: State nodal agencies check the installation.
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Subsidy Transfer: Amount is credited directly to the farmer’s bank account.
Example: For a ₹2 lakh solar pump, the government pays ₹1.2 lakh. The farmer pays only ₹80,000, which can be financed through a bank loan.
Benefits of the Subsidy
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Lower Upfront Costs: Makes solar adoption affordable.
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Faster Payback: Savings on electricity or diesel quickly cover the remaining cost.
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Extra Income: Farmers can sell surplus power to local DISCOMs.
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Encourages Sustainability: Promotes green energy adoption in rural India.
Real-Life Example
A farmer in Uttar Pradesh installed a 5 HP solar pump with PM-KUSUM subsidy:
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Total cost: ₹2.5 lakh
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Government subsidy: ₹1.5 lakh
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Farmer contribution: ₹1 lakh (loan financed)
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Annual savings on electricity: ₹18,000
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Extra income from surplus power: ₹12,000
Within the first year, the pump nearly paid for itself and continues to generate savings and income.
Role of EPC Companies
Applying and installing solar systems can be confusing. EPC companies like Solyug Renewables:
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Advise on the correct component (pump, solar plant, retrofit)
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Assist in application and documentation for subsidy
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Ensure high-quality installation
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Provide monitoring and maintenance
Farmers can focus on agriculture while the experts handle solar installation.
Tips for Maximizing Subsidy Benefits
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Apply Early: Limited slots in some states; early application ensures approval.
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Check State Policies: Some states provide additional subsidy or top-ups.
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Hire Certified EPC: Avoid installation issues that can delay subsidy transfer.
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Use Solar Efficiently: Combine irrigation and power sale to maximize ROI.
FAQs
Q1: Can small and marginal farmers get the full subsidy?
A: Yes, they are eligible, and some states provide extra incentives.
Q2: Is the subsidy paid upfront?
A: No, it is paid after verification and successful installation.
Q3: Can I install a solar system without an EPC company?
A: It is not recommended — subsidy is only approved if installation is through certified EPCs.
Q4: Can subsidy be combined with bank loans?
A: Yes, banks provide loans for the farmer’s contribution, which is repaid through savings and income.
Conclusion
The PM-KUSUM solar panel subsidy makes adopting solar energy affordable, practical, and profitable for farmers. By leveraging government support and working with trusted EPCs like Solyug Renewables, farmers can save money, earn extra income, and contribute to a cleaner environment.