Union Budget 2024 : 60% Subsidy on Residential Rooftop Solar Systems, Ensuring Free Electricity for 10 Million Households.

Residential Rooftop Solar Systems Introduction :

In a groundbreaking move announced in the Union Budget 2024, the Indian government, under the leadership of Union Minister for Power and New & Renewable Energy R K Singh, revealed an ambitious plan to increase the subsidy on residential rooftop solar systems to 60%. This initiative aims to make rooftop solar installations entirely free for 10 million households, providing free electricity to those consuming less than 300 units per month.

Residential Rooftop Solar Systems Key Highlights of the Program :

  1. Full Subsidy Coverage: Households falling under the specified criteria will not be required to make any financial investment in the installation of rooftop solar systems. Central public sector undertakings (CPSUs) designated for the task will set up 3 kW solar systems with a significantly increased subsidy rate of 60%, up from the previous 40%.
  2. Decade-Long Free Electricity: Beneficiary households will enjoy free electricity for a period of ten years, up to a monthly consumption of 300 units. During this time, any surplus electricity generated will contribute to servicing the loan availed by the CPSUs. The loan is expected to be fully repaid within the ten-year timeframe.
  3. Income Generation Beyond Ten Years: Following the initial ten-year period, households with rooftop solar systems will continue to receive free electricity up to 300 units per month. Additionally, they will derive income from any surplus electricity generated for the next 15 years or the remaining life of the system.
  4. Ownership Transfer: After the ten-year period, designated CPSUs will exit the program, and the household will gain full ownership of the rooftop solar system. This ensures a sustainable and independent energy source for the beneficiaries.
  5. Maintenance Responsibility: The maintenance of the rooftop solar system will be the responsibility of the CPSUs, ensuring a hassle-free experience for the households benefitting from the program.

Distinguishing Features:

Minister Singh highlighted the uniqueness of this program compared to its predecessor, where households were required to avail loans for rooftop solar installations. The enhanced subsidy and revised structure aim to encourage widespread adoption of residential rooftop solar systems.

Impact and Expectations:

The program, a pivotal component of the Pradhan Mantri Suryoday Yojana, is anticipated to revolutionize India’s residential solar landscape. It is expected to significantly contribute to the government’s solarization initiative for households, a sector that has seen relatively slower growth compared to utility-scale solar programs. The move aligns with the government’s commitment to sustainability and affordability, with potential annual savings of up to ₹18,000 (~$216) for each beneficiary household.


The increased subsidy on residential rooftop solar systems underscores the Indian government’s commitment to promoting clean energy and fostering financial relief for households. This forward-looking initiative is poised to accelerate the adoption of solar energy in the residential sector, marking a significant step towards achieving broader renewable energy goals.

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