CSE offers a blueprint for making PM KUSUM 2.0 stronger on implementation

• India’s flagship scheme on solar power deployment for farmers is about to enter its second phase – but it needs to address gaps in its roll-out and implementation before it can be scaled up, says a CSE assessment 

• Phase 1 has installed about 11.9 lakh standalone solar pumps -- 90 per cent of its target; 2,400 MW of decentralised grid-connected solar power has also been installed 

• Needed in Phase 2: Project readiness, bankable tariffs, grid planning, farmer-centred delivery, payment security and viable financing – says CSE  

You can find the proceedings of CSE’s webinar on the subject here: https://www.cseindia.org/redesigning-pm-kusum-2-0-13294 

New Delhi, October 28, 2026: PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan), India’s flagship scheme for deployment of solar energy solutions for farmers, is in for a revamp after its first phase came to an end this year. But its next phase cannot be business-as-usual, says Centre for Science and Environment (CSE): it should address the implementation barriers that had slowed parts of Phase I and ensure that solar deployment delivers reliable agricultural energy and measurable benefits to farmers. 

CSE presented its side of the story at a national webinar – ‘Redesigning PM-KUSUM 2.0’ – conducted on October 27, 2026. The webinar examined how the next phase can improve project preparation, strengthen financing and grid readiness, and make farmer participation central to programme design. The speakers at the webinar included Binit Das, programme manager, renewable energy, CSE; Hemanga Deka, scientific officer, Assam Energy Development Agency; Himanshu Tyagi, senior research specialist-energy, WRI India; and Priyami Dutta, policy advisor, International Institute of Sustainable Development (IISD). 

Says Das: “Phase I of PM-KUSUM concluded in March 2026 with uneven progress across its components. Component B, which supports stand-alone solar pumps, has installed about 11.9 lakh pumps, close to 90 per cent of the sanctioned target. Component A, which supports decentralised grid-connected solar power plants, has installed around 2,400 MW against the programme target of 10,000 MW. Progress under Component C has also varied by state and implementation model, with feeder-level solarisation offering a scalable route where demand and grid conditions are suitable.” 

The progress shows that simpler, farmer-facing delivery models can achieve scale, while decentralised generation and feeder-level projects require closer coordination among state agencies, distribution companies (DISCOMs), regulators, developers, lenders and landowners. State-wise implementation has also varied sharply, with some states recording little or no progress under particular components.

The government is preparing the next phase of this scheme and has indicated that it will include a dedicated agrivoltaics component. Public reporting has also referred to a proposed financial requirement of up to Rs 51,000 crore, including existing liabilities. The final outlay, eligibility conditions and implementation guidelines remain subject to formal government approval. 

CSE researchers point out that any new framework should be judged by whether it resolves barriers to implementation and improves outcomes for farmers, rather than by the size of its announced targets alone. 

Speaking at the webinar, Das said: “PM-KUSUM 2.0 should address the complete delivery chain -- from site selection and project preparation to financing, grid readiness, maintenance and farmer outcomes. Capacity should be allocated only when the conditions for implementation are in place, and performance should be measured through functioning projects and reliable agricultural energy.” 

What must India get right in redesigning PM-KUSUM in phase 2?

• Project readiness must precede allocation: Project readiness assessments should verify land access, grid capacity, clearances, procurement plans and financing arrangements before projects are taken forward.
• Bankable tariffs and payment security needed: Project economics must reflect the full costs of land, structures, grid connectivity, financing, operations and maintenance and insurance. Competitive procurement should be based on realistic cost benchmarks, and tariffs should be sufficient to support project viability and financial closure. Payment delays by DISCOMs can raise borrowing costs and weaken developers’ ability to service debt -- clear billing and payment timelines, credible payment-security arrangements, and procedures for resolving overdue invoices are needed.
• Agrivoltaics must protect farming and farmer rights: Agrivoltaics can allow solar electricity generation and crop cultivation on the same land. However, the design must reflect crop requirements, local agro-climatic conditions and farm operations. The scheme should also offer delivery models suited to different farm sizes and local conditions. Financing and eligibility arrangements should account for barriers faced by smallholders and tenant farmers. Solar irrigation should be linked with water management -- lower pumping costs can increase groundwater extraction if there are no safeguards. 

Speaking at the CSE-organised webinar, Priyami Dutta of IISD said: “The measure of success of PM KUSUM 2.0 will not be limited to how much solar capacity we installed on agricultural land, but how much tangible benefits we will be able to create for farmers who depend on their land.” 

Says Das: “PM-KUSUM 2.0 should move from allocation-led implementation to a readiness-driven, outcome-linked approach. A unified performance dashboard should track project status from sanction and tender through commissioning and operation; financing and subsidy disbursement; generation, utilisation and grid availability; equipment downtime and maintenance; and farmer outcomes such as realised savings, additional income, crop yields and water use.” 

“The framework should assign clear responsibilities to the Ministry of New and Renewable Energy and other concerned agencies. Independent assessment should help verify whether projects are operating reliably and whether they deliver the intended agricultural and environmental benefits,” he adds. 

For more details, interviews etc, please contact Sukanya Nair of The CSE Media Resource Centre: sukanya.nair@cseindia.org, +91 8816818864