Context

The Union Minister of Power, New and Renewable Energy recently reviewed the progress of the PM-KUSUM scheme and reaffirmed the government’s commitment to accelerating solar pump adoption.

Background

• It was launched in 2019.
• PM-KUSUM aims to help farmers access reliable day-time solar power for irrigation, reduce power subsidies, and decarbonise agriculture.
• PM-KUSUM provides farmers with incentives to install solar power pumps and plants in their fields.
• Three deployment models: Pumps come in three models: off-grid solar pumps solarised agricultural feeders, or grid-connected pumps.
• Off-grid pumps have been the most popular, but the nearly 2,80,000 systems deployed fall far short of the scheme’s target of two million by 2022.
• The other two models are also worth scaling up for they allow farmers to earn additional income by selling solar power to discoms, and discoms to procure cheap power close to centres of consumption.

Challenges

• Awareness challenge: Barriers to adoption include limited awareness about solar pumps.
• Upfront contribution: The other barrier includes farmers’ inability to pay their upfront contribution.
• Limited progress on two models: Progress on the other two models has been rather poor due to regulatory, financial, operational and technical challenges.

Suggestions

• Extend the scheme’s timelines: Most Indian discoms have a surplus of contracted generation capacity and are wary of procuring more power in the short term.
• Extending PM-KUSUM’s timelines beyond 2022 would allow discoms to align the scheme with their power purchase planning.
• Level playing field: Discoms often find utility-scale solar cheaper than distributed solar (under the scheme) due to the latter’s higher costs and the loss of locational advantage due to waived inter-State transmission system (ISTS) charges.
• To tackle the bias against distributed solar, we need to address counter-party risks and grid-unavailability risks at distribution substations, standardise tariff determination to reflect the higher costs of distributed power plants, and do away with the waiver of ISTS charges for solar plants.
• Streamline regulation: We need to streamline land regulations through inter-departmental coordination.
•  States should constitute steering committees comprising members from all relevant departments for this purpose.
• Financing farmers contribution:  There is a need to support innovative solutions for financing farmers’ contributions.
• Many farmers struggle to pay 30-40% of upfront costs in compliance with scheme requirements.
• To ease the financial burden on farmers, we need out-of-the-box solutions.
• Grid-connected solar pumps: Current obstacles to their adoption include concerns about their economic viability in the presence of high farm subsidies and farmers’ potential unwillingness to feed in surplus power when selling water or irrigating extra land are more attractive prospects.
• Further, the grid-connected model requires pumps to be metered and billed for accounting purposes but suffers from a lack of trust between farmers and discoms.
• Adopting solutions like smart meters and smart transformers and engaging with farmers can build trust and address some operational challenges.

Conclusion

These measures, combined with other agriculture schemes and complemented by intensive awareness campaigns, could give a much-needed boost to PM-KUSUM.

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