Executive summary
Solar is the backbone of India's clean-energy build-out. Installed solar capacity passed 140 GW by early 2026, helping non-fossil sources cross half of India's total power capacity in 2025. The national goal of 500 GW of non-fossil capacity by 2030 depends heavily on solar.
Growth is spreading from large parks to rooftops and farms. The PM Surya Ghar scheme aims to put rooftop solar on one crore homes, PM-KUSUM supports solar pumps and farm-based plants, and businesses are adopting rooftop and open-access solar to cut power costs. For installers and developers, the opportunity is large, but margins depend on execution, compliant equipment, payment security and finance.
Key takeaways
- Solar capacity passed 140 GW by early 2026 on the way to a 500 GW non-fossil goal for 2030.
- PM Surya Ghar (₹75,021 crore) targets rooftop solar for one crore households, with free electricity of up to 300 units a month.
- From 1 June 2026, solar cells in most projects must come from the government's approved list (ALMM List-II).
- Commercial and industrial rooftop and open-access solar offer MSMEs a direct way to lower energy costs.
About this niche
The solar market has three main segments: utility-scale parks selling power to distribution companies, commercial and industrial (C&I) projects on rooftops or through open access for businesses, and residential rooftop systems. Alongside these sit solar pumps and farm-based plants, and a fast-growing domestic manufacturing industry for modules and cells.
Small and medium enterprises play a big role as installers, EPC contractors, distributors and operations-and-maintenance providers, and as customers cutting their own power bills.
Market overview
Under PM Surya Ghar, households receive central financial assistance of 60% of system cost for systems up to 2 kW and 40% of additional cost between 2 and 3 kW, within the scheme's caps. The scheme has created a large pipeline of residential installations handled mainly by local vendors.
Non-fossil sources together crossed 50%: India's 2030 commitment, reached five years early.
With the share milestone met, attention has shifted to the 500 GW goal, storage, transmission and domestic manufacturing, and to the quality of execution across lakhs of smaller installations.
Industry trends
Rooftops for homes
PM Surya Ghar is driving residential rooftop installations through local vendors registered on the national portal.
Solar for business
MSMEs and commercial users install rooftop and open-access solar to reduce tariffs and meet buyers' sustainability expectations.
Domestic manufacturing
Approved-list requirements for modules and, from June 2026, cells are building a domestic supply chain.
Solar on farms
PM-KUSUM supports solar pumps and small solar plants on farmland, adding income for farmers.
Storage and round-the-clock power
Battery storage is increasingly paired with solar to deliver power when the sun is down.
Key challenges
Working capital for installers
Subsidy disbursal, customer payments and inventory can stretch the cash cycle of small installers.
Equipment compliance and cost
Approved-list requirements change supplier choices and costs, and need careful procurement planning.
Off-taker risk
For C&I and open-access projects, the customer's creditworthiness drives financing terms.
State rules
Net-metering limits, open-access charges and banking provisions vary by state and change over time.
"The solar opportunity is no longer about whether to build. It is about building well and getting paid."
Regulatory landscape
| Area | Main rules | What it means in practice |
|---|---|---|
| Equipment | ALMM Order: List-I (modules); List-II (cells) from 1 June 2026 | Most government-backed, net-metering and open-access projects must use listed modules and, from June 2026, listed cells. |
| Rooftop schemes | PM Surya Ghar guidelines; national rooftop portal | Vendor registration, system standards and subsidy processes for residential installations. |
| Farm solar | PM-KUSUM guidelines | Component-wise rules for solar pumps and farm-based plants. |
| Grid connection | State net-metering and green energy open-access regulations | Limits, charges and banking rules decide project economics state by state. |
| Quality | BIS standards for solar equipment | Certified components protect performance, warranties and eligibility. |
Plan procurement early
The approved-list requirement for solar cells applies from 1 June 2026, with exemptions for projects bid out before the order. Check which rules apply to each project before finalising procurement.
Opportunities
- Residential rooftop installation. A large, scheme-backed market for local installers with good service and financing partners.
- C&I solar for MSMEs. Rooftop and open-access projects that cut factory power bills, under capex or pay-as-you-save models.
- Operations and maintenance. A growing installed base needs cleaning, monitoring and repairs, a recurring-revenue business.
- Solar plus storage. Pairing batteries with solar for businesses that need reliable power through the day and evening.
How Brydgework helps
Busy but cash-strapped
- Installations growing, cash shrinking
- Pricing without full cost clarity
- Dependence on a few suppliers
- Projects hard to finance
A bankable solar business
- Working capital planned to subsidy and payment cycles
- Project-level costing and pricing
- Compliant, diversified procurement
- Lender-ready project documentation
Relevant services
- Financial Solutions: project finance, working capital and lender documentation.
- Organisational Structuring: project structures, contracts and compliance.
- Consulting & Strategy: market selection, pricing and partnerships.
- Branding & Outreach: brand and customer acquisition for installers.
Engagement process
Business and project review
Economics of current projects, cash cycle, procurement and pipeline.
Strategy and model
Target segments, pricing and contract models, with a financial plan.
Finance and documentation
Lender documentation, financing partners and working-capital lines.
Scale-up support
Systems for procurement, execution and after-sales as volumes grow.
Frequently asked questions
Central financial assistance covers 60% of system cost up to 2 kW and 40% of additional cost between 2 and 3 kW, subject to the scheme's caps. Households can also access concessional loans through banks.
From 1 June 2026, most government-backed, net-metering and open-access projects must use solar cells from the approved List-II, in addition to listed modules. Projects bid out before the order are exempt.
It depends on your tariff, roof space, consumption pattern and state rules. For many MSMEs paying commercial or industrial tariffs, payback periods are attractive. A site-specific assessment is the place to start.
Yes. We prepare financial statements, projections and documentation for working-capital limits and help match the facility to your subsidy and payment cycles.
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