A recent study by Puducherry-based think tank Auroville Consulting reveals that Tamil Nadu’s extensive free and subsidised electricity schemes pose a significant barrier to the adoption of solar power. Particularly affected are farmer-focused programs like PM KUSUM-C and residential schemes such as PM Surya Ghar.The study found no uptake of PM KUSUM-C — aimed at solarising agricultural pumps — in Tamil Nadu since its 2019 launch, largely due to opposition against introducing energy meters for unmetered farm electricity.The misconception that metering would bring electricity charges has discouraged farmers from adopting solar solutions despite subsidy incentives.
Additionally, Tamil Nadu’s free and low-cost electricity for households and farmers diminishes the financial appeal of rooftop solar, as consumers face little incentive to invest in solar energy when they receive up to 100 units free per month.
This “subsidy trap,” characterized by tariff suppression and fiscal bailouts, protects consumers in the short term but undermines long-term solar deployment and causes persistent losses for power utilities.
Despite Tamil Nadu’s technical rooftop solar potential of over 60 GW, only about 2% has been realised by mid-2025. The study suggests reforms such as 100% subsidies under PM KUSUM-C, targeted support, direct benefit transfers, and dedicated programs for low-income households and marginal farmers.
These measures could help Tamil Nadu achieve social welfare, economic growth, and environmental sustainability goals simultaneously.