ABD approves loan worth $650 million to boost India`s rooftop solar adoption
Multilateral development bank --Asian Development Bank (ADB) has approved a policy-based loan worth $650 million (around Rs 5,780 crore) to help the Government of India accelerate rooftop solar adoption and expand access to clean, affordable energy for 10 million households by 2027. The bank said that the financing under Subprogram 1 of the Accelerating Affordable and Inclusive Rooftop Solar Systems Development Program will support the government's flagship initiative Pradhan Mantri Surya Ghar: Muft Bijli Yojana (PMSGMBY) which aims to make rooftop solar systems widely accessible nationwide. ADB’s Country Director for India noted that the programme is accelerating India's clean energy transition by removing long-standing barriers to rooftop solar adoption, including financing constraints and regulatory gaps. Further, it is making rooftop solar affordable and accessible for millions of households while creating green jobs, empowering women, and strengthening the financial health of the power sector.
The bank highlighted that PMSGMBY will provide financial assistance to residential consumers for installing rooftop solar systems of up to 3 kilowatts (kW), with a 60 per cent subsidy for systems up to 2 kW and a 40 per cent subsidy for additional capacity between 2 kW and 3 kW. It has emphasized the key reform areas under the programme which include developing uniform operational guidelines and quality standards for residential rooftop solar systems and facilitating mass adoption among low- and middle-income households through collateral-free, low-interest loans. Besides, the programme will enhance the skills and capacity of at least 5,000 personnel, including 1,500 women, supporting India's Nationally Determined Contribution targets.
Moreover, the bank’s support is expected to significantly contribute to the nationwide objective of installing 30 gigawatts of rooftop solar capacity, achieving annual reductions of 28.8 million tonnes of CO2 emissions, and delivering affordable solar energy to millions of households. It will also boost private sector investment to create opportunities for manufacturers, vendors, and service providers across the renewable energy value chain. The bank's financing for the programme includes $3 million in technical assistance to help implement reforms, build institutional capacity, and promote gender-inclusive participation in the rooftop solar sector.
