India saw a multi-fold increase in the number of applications submitted for installation of rooftop solar panels this year under the Pradhan Mantri Surya Ghar Yojana (PMSGY), yet failed to meet its set target.
A report by the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research & Analytics released on Tuesday that over 57.9 lakh installation applications were submitted as of July this year and around 4.9 GW of residential rooftop solar capacity added.
“PMSGY has steadily expanded its policy framework to speed up residential rooftop solar adoption. Since 2024, it has rolled out a nationwide capacity-building programme to train over three lakh people and help vendors, utilities and financiers upskill,” said Jyoti Gulia, Founder, JMK Research, and a contributing author of the report.
However, despite a near four-fold increase in applications between March 2024 and July 2025, only 13.1 per cent of the target of 1 crore installations has been met, which leaves a huge scope for the country’s FY2027 target of 30GW capacity to be met.
Additionally, just 14.1 per cent of the allocated ₹65,700 crore (USD 7.5 billion) in subsidies was released till July 2025.
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The report attributes lack of consumer awareness and fragmented supply chains for key rooftop solar components to be the chief reasons for fewer applications for solar power installation than anticipated.
“Low consumer awareness and access to finance remain significant barriers to the adoption of rooftop solar. Outdated perceptions of high upfront costs and maintenance persist, especially in rural areas,” said Prabhakar Sharma, senior consultant, JMK Research, and a co-author of this report.
Fragmented supply chains for key rooftop solar components, such as panels, inverters and mounting structures, also cause implementation delays, the report showed.
“The rooftop solar market continues to face fragmented quality and weak end-to-end guarantees, challenges that standardised plug-and-play solutions can resolve,” said Sharma.
Under PMSGY, Gujarat leads all states with the highest installed residential rooftop solar capacity of 1,491MW, followed by Maharashtra, Uttar Pradesh, Kerala and Rajasthan.
These states together account for around 77.2 per cent of the total installed capacity (4,946 MW) under the scheme till July 2025.
While a grievance redressal system has been set up under PMSGY, its effectiveness is limited.
“Establishing clear, time-bound rooftop solar capacity targets at the state-level is essential for creating a coherent vision and ensuring effective policy execution,” said Vibhuti Garg, Director, IEEFA – South Asia, and a contributing author.
The authors also advise addressing subsidy disbursement delays, incorrect data entries or portal malfunctions through the setting-up of a district-level escalation matrix.
“PMSGY should establish a district-level escalation matrix so that subsidy disbursement delays, incorrect data entries or portal malfunctions can be routed beyond the DISCOM or portal level,"” said Aman Gupta, research associate at JMK Research, and a co-author of this report.
To increase the conversion of applications into actual installations, state- and district-level facilitation cells should guide households in filing applications and claiming subsidies, the report states, adding that marketing campaigns and consumer outreach initiatives can be taken up to educate potential adopters.
IEEFA further said that promoting the commoditisation of rooftop solar kits, with modules, inverters, mounting structures and cables supplied as standardised, pre-assembled packages, can simplify installation and minimise project delays.
The long-term success of PMSGY hinges not only on the provision of subsidies, but also on its ability to institutionalise digital processes, standardised product solutions and consumer-centric support systems, said the authors in the report.
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