ADB approves USD 650 million loan for India’s rooftop solar program

ADB has approved a USD 650 million policy-based loan to support India’s plan to expand rooftop solar and deliver clean, affordable electricity to 10 million households by 2027. The funding is part of Subprogram 1 of the Accelerating Affordable and Inclusive Rooftop Solar Systems Development Program, which is linked to the Pradhan Mantri Surya Ghar Muft Bijli Yojana.

ADB Country Director for India Mio Oka said the initiative addresses financing and regulatory hurdles that have slowed residential adoption. She said the program improves affordability, broadens access, and strengthens sector stability while supporting job creation and women’s participation.

The government will provide financial assistance for residential rooftop solar systems of up to 3 kW. Consumers will receive a 60 per cent subsidy for systems up to 2 kW and a 40 per cent subsidy for the 2 kW to 3 kW segment. The program will establish uniform operational guidelines and quality standards. It will also promote adoption among low and middle income households through collateral free, low interest loans.

The reforms align with India’s Nationally Determined Contribution targets. They include training and capacity building for at least 5,000 people, including 1,500 women. The program will also support utility led aggregation models, develop model solar villages, and strengthen the vendor ecosystem.

ADB expects the initiative to advance the national goal of reaching 30 GW of rooftop solar capacity. The bank estimates annual reductions of 28.8 million tons of CO2 and expanded access to low cost solar power. The intervention is also expected to mobilise private capital and create opportunities across the renewable energy supply chain.

ADB’s support includes USD 3 million in technical assistance for institutional strengthening and reform implementation with a focus on gender inclusion. 

In November, ReNew Energy received USD 331 million in debt financing from ADB for a large clean energy project in Andhra Pradesh, including USD 291 million in local currency from ADB’s ordinary capital resources and USD 40 million from the Leading Asia’s Private Infrastructure Fund 2. In the same month, ADB also approved a USD 460 million results based loan to upgrade Maharashtra’s rural distribution network and promote distributed renewable energy to ensure reliable daytime solar supply for irrigation.

The featured photograph is for representation only.