ADB Approves $650M Loan to Speed Up Rooftop Solar India

• ADB approves USD 650 million loan to expand rooftop solar for 10 million households by 2027
• Subsidies and reforms include 60% support for systems up to 2 kW, 40% for 2–3 kW, low-interest loans, and skill development for 5,000 personnel
• Expected outcomes are 30 GW rooftop solar capacity, 28.8 million tonnes of CO₂ reduction, and increased private sector investment

The Asian Development Bank (ADB) has approved a USD 650 million (around Rs 5,780 crore) policy-based loan to support the Government of India in accelerating rooftop solar adoption and expanding access to clean, affordable energy for 10 million households by 2027.

This funding is part of Subprogram 1 of the Accelerating Affordable and Inclusive Rooftop Solar Systems Development Programme. This programme supports the Prime Minister's funding for Pradhan Mantri Surya Ghar: Muft Bijli Yojana (PMSGMBY), which seeks to increase accessibility to rooftop solar for all citizens across India.

The ADB loan India aims to accelerate rooftop solar adoption by providing solar energy funding, promoting renewable energy India, supporting clean energy investment, strengthening solar infrastructure, and advancing India green energy initiatives.

The programme will tackle long-standing challenges that prevent the widespread use of rooftop solar, including issues with finance and regulatory uncertainty. The Loan will provide greater access to affordable solar energy and green job opportunities for women.

Additionally, PMSGMBY will also improve the financial viability of the power sector, providing means for residential customers to install rooftop solar power systems, both of which can be up to 3kW. Customers can receive financial assistance for the installation of rooftop solar power systems, with a 60% subsidy for systems up to 2kW and a 40% subsidy on the excess capacity between 2kW and 3kW.

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The key reforms within the program will be a set of uniform operational guidelines and a set of quality standards for residential rooftop solar systems; as well as support for increasing mass adoption by low- and middle-income households of residential rooftop solar systems through the means of providing collateral-free, low-interest loans and utility-led aggregation models and model solar villages.

In addition, the program will also create job opportunities by training at least 5,000 people (including 1,500 women) in solar PV installations, while concurrently developing a sustainable vendor ecosystem that will be able to take full advantage of the opportunities presented by this program.

By achieving its goals, ADB anticipates that the program will assist India in reaching the national target of creating a total of 30 GW of rooftop solar; will prevent 28.8 million tonnes of CO2 emissions every year; and will provide affordable access to solar energy for the entire country of India.

This initiative will also generate a number of benefits for private sector investment through supply chain development and the formation of a renewable energy ecosystem that will create jobs and new markets throughout the renewable energy value chain.

Technical assistance of USD 3 million will be provided to the program in support of programmatic reforms, strengthening institutional capacity and inclusion of women in the rooftop solar sector.