The government is preparing a major overhaul of the PM Surya Ghar: Muft Bijli Yojana that could shift the focus of public support from installing rooftop solar panels to how much electricity they generate, how long they perform and how effectively they support the power grid.
The proposed framework may also introduce generation guarantees, virtual metering, AI-based quality checks and differentiated financial assistance based on household income, location, consumer category and the services provided by rooftop systems to the electricity grid.
PM Surya Ghar currently provides central financial assistance for residential rooftop-solar installations, with subsidies linked largely to installed capacity rather than actual electricity generation or the asset’s performance over its operational life.
A consolidated policy paper is expected within 10-15 days, followed by focused consultations in about 20 days on batteries, hybrid inverters, equipment interoperability, DISCOM readiness and regulatory changes, the Financial Express learnt following a meeting chaired by a joint secretary in the Ministry of New and Renewable Energy.
“The next phase should not be limited to continuation of the existing subsidy structure,” a senior MNRE official said, calling for a combination of regulation, market mechanisms, technology standards and public support to deepen rooftop-solar penetration while gradually creating a self-sustaining market.
A split financial-assistance structure is under examination. One component could support upfront capital expenditure, while another may be linked to electricity generation, operations and maintenance, battery storage or service delivery over the life of the asset.
The meeting noted that consumer adoption could remain strong with a payback period of five to six years, but weaken materially once it exceeds seven years. Higher-income households may continue adopting rooftop solar with lower support, while poorer consumers could require stronger or differently structured assistance.
States providing free or heavily subsidised electricity may also examine converting recurring power subsidies into one-time solarisation support, potentially reducing their long-term subsidy burden.
Battery storage is expected to become central to the redesign as rising rooftop capacity increases daytime power exports and grid-management requirements. MNRE will assess household, transformer, distribution and utility-scale storage models by comparing capital costs, grid benefits, avoided infrastructure expenditure, consumer value and operational control.
“India’s rooftop solar story is entering a new phase. The question is no longer how many panels we install, but how effectively we use the energy they generate. Storage is the missing link that can align consumer savings with grid requirements and make distributed solar more valuable for the entire electricity system,” said Ashish K Sharma, Fellow, TERI.
Inputs presented at the meeting proposed two complementary storage pathways: behind-the-meter batteries at consumer premises and systems deployed downstream in the distribution network. Batteries could absorb excess daytime exports, provide household backup, reduce reverse power flow, support peak-demand management and improve grid-asset utilisation.
Consumer-side storage could be targeted at high-solar or constrained feeders, while substation-level battery energy storage systems could be deployed where network conditions justify them. The model is intended to deliver lower bills and better backup for consumers, while giving DISCOMs greater hosting capacity, voltage support and more efficient use of network assets.
Benefit-sharing models are also under consideration to make household batteries more affordable. A portion of the savings realised by DISCOMs through power-purchase optimisation and avoided network expenditure could be returned to participating consumers.
The scheme may also extend access to apartment residents and households without suitable roofs through virtual and group net metering, balcony solar, facade-mounted systems and building-integrated photovoltaics. Community plants of about 100 kW could be examined for low-income consumers seeking systems of 1-2 kW.
Quality and long-term performance will receive greater attention. The chair said the programme “should shift from an installation-centric model towards an asset-performance model”. Proposals include generation guarantees, mandatory service periods, insurance against equipment failure and generation shortfall, and a digital solar passport recording output, service history and warranty status.
MNRE also plans a common data protocol covering more than 100 inverter and equipment manufacturers. Daily generation data could support monitoring, DISCOM planning, maintenance alerts and warranty enforcement, while AI may verify installations, identify components and detect defects.