Central Government Solar Subsidy 2026: All Schemes & Benefits Explained

The central government offers solar subsidies primarily through PM Surya Ghar Yojana (up to ₹78,000 for residential rooftop solar) and PM-KUSUM (for agricultural solar pumps). Residential homeowners benefit most from PM Surya Ghar, which provides ₹30,000/kW for systems up to 2 kW and ₹18,000/kW for the 3rd kW. Commercial establishments can claim 40% accelerated depreciation on solar assets under the Income Tax Act.

PM Surya Ghar Muft Bijli Yojana is by far the most impactful central scheme for homeowners. Key features:

• Budget: ₹75,021 crore allocated for the scheme period (2024–2027)
• Target: 1 crore households across India
• Subsidy: ₹30,000/kW (up to 2 kW) + ₹18,000/kW (3rd kW) = max ₹78,000
• Disbursement: Direct Benefit Transfer (DBT) to bank account
• Eligibility: Any residential consumer with a valid DISCOM connection

The scheme replaced the earlier Phase II grid-connected rooftop solar programme and offers higher subsidy rates with a simplified application process through a unified national portal.

→ Complete PM Surya Ghar guide with application steps

MNRE sets the technical standards that all subsidised installations must meet. These are non-negotiable for subsidy eligibility:

• Panel certification: Must carry BIS (IS 14286) certification. IEC certification alone is not sufficient for subsidy
• Inverter certification: Must be BIS-certified (IS 16169 for grid-tied inverters)
• Vendor empanelment: Installer must be registered on the PM Surya Ghar portal as an empanelled vendor with valid credentials
• System design: Must comply with MNRE technical specifications for mounting, wiring, earthing, and protection systems
• Warranty requirements: Minimum 25-year panel warranty and 5-year inverter warranty

These standards exist to protect consumers and ensure system quality. Working with an MNRE-empanelled installer like those on Solar Vipani guarantees compliance.

→ Detailed MNRE technical guidelines

Commercial and industrial solar installations don't qualify for PM Surya Ghar subsidies, but they benefit from accelerated depreciation under Section 32 of the Income Tax Act:

• Depreciation rate: 40% in the first year on the total solar asset cost
• Benefit: Significant tax saving — on a ₹10 lakh commercial solar system, you can claim ₹4 lakh depreciation in Year 1
• Eligibility: Any business that owns the solar system (not leased) and files income tax returns
• Combination: Cannot be combined with PM Surya Ghar subsidy (residential only), but can be used alongside state incentives for commercial systems

For businesses with high tax liability, accelerated depreciation can be more valuable than a direct subsidy. A 5 kW commercial rooftop system at ₹3,00,000 with 40% depreciation saves ₹1,20,000 in Year 1 taxes (at 30% tax rate).

→ Commercial solar incentives in detail

PM-KUSUM (Kisan Urja Suraksha evam Utthaan Mahabhiyan) is the central government's scheme for agricultural solar. It has three components:

1. Component A: 10,000 MW of decentralised ground-mounted solar power plants on barren/fallow agricultural land
2. Component B: Installation of 20 lakh standalone solar-powered agricultural pumps
3. Component C: Solarisation of 15 lakh existing grid-connected agricultural pumps

Under Components B and C, farmers get a combined central + state subsidy of up to 60%, paying only 40% of the pump cost (with loan options for their share).

→ Complete KUSUM scheme guide for solar pumps

Follow these principles to get the full benefit:

1. Size your system at 3 kW — This maximises the per-kW subsidy. Going above 3 kW still gets only ₹78,000
2. Choose an MNRE-empanelled vendor — Non-empanelled vendors cannot process your subsidy. Solar Vipani only lists empanelled installers
3. Ensure BIS-certified equipment — Reject quotes using non-BIS panels or inverters, even if cheaper. Subsidy will be denied
4. Apply before installation — Register on the portal first, get feasibility approval, then proceed with installation
5. Keep documents ready — Aadhaar linked to bank account, recent electricity bill, and roof ownership proof

The most common reason for subsidy rejection is using a non-empanelled vendor or non-certified equipment. Avoid this by working with verified installers.

Every installer on Solar Vipani is MNRE-empanelled and authorised to process PM Surya Ghar subsidies. Your quote will include the exact subsidy amount and your net out-of-pocket cost.

Get free solar quotes with subsidy calculation →