Introduction

The PM-KUSUM Scheme, launched in March 2019 by the Ministry of New and Renewable Energy (MNRE), Government of India, aims to promote solar energy in agriculture, ensuring energy security for farmers and supporting India’s commitment to increase non-fossil fuel energy capacity to 40% by 2030. The scheme targets a solar capacity of 34,800 MW by March 2026 with a central financial support of ₹34,422 crore, empowering farmers through sustainable energy solutions, reduced diesel dependency, and enhanced income opportunities.

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Objectives

• Energy Security: Provide reliable daytime power for irrigation.
• De-Dieselization: Replace diesel-powered pumps with solar pumps to reduce costs and environmental impact.
• Income Enhancement: Enable farmers to earn additional income by selling surplus solar power to the grid.
• Environmental Sustainability: Reduce carbon emissions through clean energy adoption.

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Components of the Scheme

The PM-KUSUM Scheme comprises three components to achieve its goals:

Component A: Decentralized Grid-Connected Solar Power Plants

• Objective: Set up 10,000 MW of grid-connected renewable energy power plants (500 kW to 2 MW) on barren or cultivable land (using stilts for farming compatibility).
• Eligibility: Individual farmers, groups of farmers, cooperatives, panchayats, Farmer Producer Organizations (FPOs), and Water User Associations (WUAs).
• Financial Support: No direct subsidy; power purchased by DISCOMs at a pre-fixed tariff for 25 years. Procurement-Based Incentive (PBI) of 40 paise/kWh or ₹6.6 lakh/MW/year (whichever is lower) provided to DISCOMs for five years.
• Implementation: Projects must be within a 5 km radius of sub-stations to minimize transmission losses.

Component B: Standalone Solar Agriculture Pumps

• Objective: Install 14 lakh standalone solar pumps (up to 7.5 HP) for irrigation.
• Financial Support: Central Financial Assistance (CFA) of 30% (50% in North Eastern States, Sikkim, Jammu & Kashmir, Himachal Pradesh, Uttarakhand, Lakshadweep, and Andaman & Nicobar Islands), state subsidy of 30%, and farmer contribution of 10%. The remaining 30% can be covered through loans.
• Benefits: Reduces reliance on diesel/electricity, lowers irrigation costs, and provides eco-friendly irrigation solutions.

Component C: Solarization of Grid-Connected Agriculture Pumps

• Objective: Solarize 35 lakh existing grid-connected pumps (up to 7.5 HP), including Feeder Level Solarization (FLS).
• Financial Support: Similar to Component B, with CFA of 30% (50% in specified regions), state subsidy of 30%, and farmer contribution of 10%. Loans available for the remaining cost.
• Implementation: CAPEX or RESCO mode; CFA released in phases based on project milestones. Farmers receive daytime reliable power at fixed or no cost.

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Benefits

• • Cost Savings: Significant reduction in diesel and electricity expenses for irrigation.
  • Income Generation: Farmers can sell excess power to DISCOMs, creating a steady revenue stream.
  • Reliable Irrigation: Daytime solar power ensures efficient irrigation, reducing water wastage.
  • Environmental Impact: Promotes clean energy, reducing carbon emissions and environmental pollution.
  • Agricultural Productivity: Enhanced irrigation access improves crop yields.

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Eligibility

• • Component A: Individual farmers, farmer groups, cooperatives, panchayats, FPOs, and WUAs with land within 5 km of a sub-station.
  • Components B & C: Farmers with agricultural pumps requiring solarization or new solar pump installations.
  • Land Requirement: For Component A, projects can use barren, fallow, or cultivable land (with stilts for farming).

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Application Process

1. 1. Visit Official Portal: Access the PM-KUSUM portal (pmkusum.mnre.gov.in) or state-specific renewable energy department websites.
   2. Registration: Click on the “Registration” or “Apply Now” section and fill in details like name, Aadhaar number, land details, and bank account information.
   3. Document Submission: Upload scanned copies of Aadhaar card, land ownership proof, and bank details.
   4. Verification: Authorities verify land ownership, subsidy history, and eligibility.
   5. Payment: Farmers deposit 10% of the project cost to the supplier after approval.
   6. Installation: Solar pumps or plants are installed within 90-120 days post-subsidy sanction.
   7. Status Check: Track application status on the portal using the application number or contact local energy/panchayat offices.

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Financial Assistance

• • • Component A: No direct subsidy; income through power sales and PBI for DISCOMs.
    • Components B & C:
      • Central subsidy: 30% (50% in specified regions).
      • State subsidy: 30%.
      • Farmer contribution: 10%.
      • Loan: Up to 30% of project cost (max ₹10 crore for Component A; 30% for Components B & C).
    • Loan Details:
      • Tenure: Up to 15 years (including 12-month moratorium post-commercial operation).
      • Interest: As per bank guidelines (e.g., State Bank of India, Union Bank of India).Security: Per bank norms; MSME borrowers can avail CGTMSE benefits.

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Key Updates (as of 2025)

• Target Expansion: Increased from 35 lakh to 49 lakh pumps for Components B and C (September 2023).
• Simplified Guidelines: Land aggregation streamlined for Component C (July 2023).
• Mandatory State Share Removed: November 2023 amendment for flexibility.
• DCR Waiver: Extended until March 31, 2024, for Component C.
• Progress: Over 4.11 lakh farmers benefited as of June 30, 2025.

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Challenges

• High Initial Costs: Despite subsidies, financing remains a barrier for some farmers.
• Grid Integration: Technical and regulatory challenges in connecting decentralized solar projects.
• Pump Capacity: Focus on 3 HP+ pumps excludes small/marginal farmers.
• Water Table Decline: Higher-capacity pumps may require additional solar panels, increasing costs.