States have cumulatively installed only half of the allocated capacity of 3.38 GW in the residential rooftop solar segment as part of the Ministry of New and Renewable Energy’s (MNRE) Phase II Grid-Connected Rooftop Solar Program, the Union Power Ministry R.K. Singh told the Rajya Sabha.

At the end of February, the states’ total installations stood at 1.78 GW as against the target of 4 GW.

MNRE had extended Phase II of the program until March 31, 2026, without any addition to the initial outlay of ₹118.1 billion (~$1.66 billion) for both the residential segment (Component A) and distribution companies (Component B).

A total of ₹29.2 billion (~$352.3 million) has been released to these agencies under the program. So far, around 430,000 households have reported receiving benefits.

In terms of installed capacity during the second phase, Gujarat was the clear leader, with 1.45 GW out of the allocated 1.93 GW. The state was allocated a budget of ₹22.4 billion ($270.48 million).

Kerala ranked second with 113 MW installed out of the 361 MW allocated. It received a budget allocation of ₹1.3 billion ($16.2 million).

Rajasthan secured the third position with 36.3 MW of installations out of the 100 MW allocated. Rajasthan was allocated a budget of ₹1.2 billion (~$14.13 million).

India added 1.6 GW of rooftop solar capacity in 2022, nearly a 4% decline year-over-year, compared to 1.7 GW in 2021, according to Mercom India Research’s newly released 2022 Q4 & Annual Mercom India Rooftop Solar Market Report.

Cumulative rooftop solar installations stood at nearly 8.8 GW as of December 2022.

The residential sector accounted for approximately 32% of all installations during the year.

MNRE had increased the Central Financial Assistance for residential rooftop solar consumers of the northeastern states, along with the hilly states of Uttarakhand, Himachal Pradesh, and the union territories of Jammu and Kashmir, Ladakh, Lakshadweep, and Andaman & Nicobar Islands. The ministry had received requests from stakeholders for higher financial assistance in line with the higher benchmark costs prescribed for these states.

At the end of 2022, India has only achieved 21% of targeted installations at just 8.3 GW against the government target of 40 GW.

Singh had recently highlighted the lack of initiative from state-owned power distribution companies as the primary reason for tepid growth in rooftop solar installations.

In June last year, the World Bank approved $165 million in additional financing to accelerate the adoption of rooftop solar by residential consumers in India by making it more affordable.