Government approves scheme for free solar electricity to one crore households

On Thursday, the government sanctioned a scheme to equip rooftops with solar panels, offering free electricity up to 300 units per month for one crore households. This initiative, named “PM-Surya Ghar: Muft Bijli Yojna,” carries a total budget of Rs 75,021 crore.

Under this scheme, households can slash their electricity bills and even earn income by selling excess power to distribution companies. The Union Cabinet, led by Prime Minister Narendra Modi, gave the green light to this initiative, which was launched on February 13 this year.


According to an official statement, the scheme provides a Central Financial Assistance (CFA) for residential rooftop solar systems. This assistance covers 60% of the system cost for 2 kW systems and 40% of the additional cost for systems between 2 to 3 kW capacity.

Approximately 17 lakh direct jobs are expected to be created in various sectors such as manufacturing, logistics, sales, installation, and maintenance due to this scheme.

The CFA will be capped at 3 kW, resulting in a subsidy of Rs 30,000 crore for 1 kW systems, Rs 60,000 crore for 2 kW systems, and Rs 78,000 crore for 3 kW systems or higher, based on current benchmark prices.

Households can apply for subsidies through the National Portal and choose suitable vendors for panel installation. The portal will assist households by providing relevant information such as system sizes and vendor ratings.

Additionally, households can access collateral-free, low-interest loans of around 7% for rooftop solar installations. To promote adoption, the government plans to develop a Model Solar Village in each district as a demonstration of the scheme’s benefits.

With this initiative, households can not only reduce electricity bills but also generate additional income by selling surplus power to distribution companies. On average, a 3 kW system can produce more than 300 units of electricity per month for a household.