What is the Pradhan Mantri Suryoday Yojna rolled out by PM Modi: Explained in details

PM Modi's January 22 announcement seeks to revamp and further streamline the decentralised solar power space, aligning with the Centre's initial 2014 target of installing 100 GW of solar power by 2022.

Finance Minister, Nirmala Sitharaman, highlighted the recently-launched rooftop solar initiative for households, known as the 'Pradhan Mantri Suryoday Yojna,' in the Interim Budget presented on February 1.

Notably, Moneycontrol was the first to report on January 24 that the 'Pradhan Mantri Suryoday Yojna' would be featured in the Budget speech, with anticipations of increased subsidies under the scheme.

During her Budget speech, Sitharaman mentioned that the scheme aims to install solar setups in one crore households, leading to monthly electricity savings of approximately 300 units per home. She further stated that, on an annual basis, the initiative could translate to savings ranging from Rs 15,000 to Rs 18,000 for households adopting rooftop solar systems.

On January 22, Prime Minister Narendra Modi declared that upon his return from Ayodhya after the consecration ceremony at the Ram temple, his initial action would be to initiate the Pradhan Mantri Suryoday Yojna in one crore households.

"Through rooftop solarisation, one crore households will be enabled to attain up to 300 units free electricity every month. This scheme follows the resolve of the Prime Minister on the historic day of the consecration of Ram Mandir in Ayodhya," Sitharaman had noted in her Budget speech.

Moneycontrol takes a look at this scheme that is not only focused on lighting up the homes of poor and middle-class families but also aligns with the nation's longer-term clean energy goals.

What is the Pradhanmantri Suryodaya Yojana?

Pradhanmantri Suryodaya Yojana is a programme aimed at implementing solar power systems on residential rooftops.

The objective of this initiative is to deliver electricity to households through solar rooftop installations, with an additional benefit of earning income for surplus electricity generation.

PM Modi has emphasised that this initiative would not only curb electricity expenses for the poor and middle class but also contribute to the nation's self-reliance in the energy sector, aligning with the country's broader energy goals. Essentially, this initiative involves the installation of solar power systems on residential rooftops.

Initiated in 2014, the programme aims to enhance India's residential rooftop solar capacity by providing central financial assistance, in accordance with the Ministry of New and Renewable Energy (MNRE) Guidelines, and offering incentives to distribution companies (DISCOMs).

With a target of achieving 40 GW of rooftop solar installed capacity by March 2026, the programme is currently in its second phase. Thanks to this initiative, the country's rooftop solar capacity has surged from 1.8 GW in March 2019 to 10.4 GW in November 2023.

Also Read | Pradhan Mantri Suryoday Yojana: REC Ltd made nodal agency; to lend Rs 1.2 lakh cr

India's solar capacity

As of December 2023, India's overall solar capacity stands at approximately 73.31 GW, with rooftop solar capacity reaching around 11.08 GW. While Rajasthan leads in total solar capacity with 18.7 GW, Gujarat leads in rooftop solar capacity with 2.8 GW.

Solar power constitutes a significant portion of the country's renewable energy capacity, totaling around 180 GW.

Presently, approximately 7-8 lakh households have implemented rooftop solar systems, availing government capital subsidy programmes, leading to the creation of approximately 4 gigawatts of solar capacity.

Also Read | Before Ayodhya, came Sanchi: Which Indian cities are transitioning into solar cities?

Scheme roll-out and application

PM Modi's January 22 announcement seeks to revamp and further streamline the decentralised solar power space, aligning with the Centre's initial 2014 target of installing 100 GW of solar power by 2022.

The new programme, concentrating on households, differs in approach and seeks to tap into the largely unexplored residential sector, which currently comprises only 20 percent of rooftop solar installations.

It should be noted that India is globally committed to achieving a target wherein approximately 50 percent of its electricity generation capacity will be derived from non-fossil fuel sources by 2030. Currently, this proportion stands at 43 percent, with wind, solar, and biogas contributing around 30 percent to the overall installed capacity.

Nevertheless, given the projected spike in India's electricity demand and the limited potential for substantial growth in other non-fossil fuel sources, such as nuclear or hydro, there is a pressing need for rapid expansion of renewable energy, particularly solar power, to meet the skyrocketing demand.

The primary objectives of such programmes, whether focused on capacity or households, remain consistent - ensuring energy security, transitioning to non-fossil fuel sources, and enhancing energy access.