PM-KUSUM worked. The next chapter has to be about farmer income

I grew up in a farming village in Madhya Pradesh, so I read the PM-KUSUM scorecard differently than most people in the energy business do. When I look at the numbers, I do not see a programme that has fallen short. I see one that has quietly proven the most important thing it set out to prove – and then stopped one step short of the goal that actually matters.

Here is the scorecard, as it stands in mid-2026. Under Component-B, the standalone solar pumps that replace diesel, more than 10 lakh units have gone in against a target of roughly 13 lakh. That is around 80% delivered. Feeder-level solarisation has crossed 15 lakh installations. More than 21 lakh farmers have touched the scheme in some form. By any measure of adoption, that is a success. Farmers did not need to be convinced that solar works in the field. They adopted it the moment the economics made sense.

Now look at Component-A – the part of the scheme that lets a farmer or a group of farmers set up a 500 kW to 2 MW solar plant and sell power. Against a sanctioned 10,000 MW, barely 1,200 MW is installed. Around 12%. The component designed to turn the farmer into a producer is the one we have executed least.

That gap is the whole story. And it tells us exactly where the next phase has to go.

Subsidies create installations. They do not create enterprises.

PM-KUSUM was built, sensibly, around subsidy. With ₹50,000 crore allocated in the 2026-27 Budget, the commitment is clearly still there.

But a subsidy is a one-time event. It changes the cost of a purchase. It does not, by itself, change what a farm is. And that is the limitation we are now running into. The components that treat the farmer as a consumer of subsidised equipment – pumps – have raced ahead. The component that treats the farmer as an owner of an income-generating asset has lagged, because subsidy alone was never going to carry it. Producing and selling power is not a purchase. It is a small business. And we have not built the rails for that business.

This is the difference between energy security and energy income. A solar pump gives a farmer reliable daytime water and frees him from diesel bills and erratic grid supply. That is real, and it matters. But it is a cost saved, not a rupee earned. The far larger opportunity – the one that can actually change a rural household’s economics – is when the sun becomes a second crop. When the farmer harvests electrons alongside wheat, and the surplus goes to the DISCOM at a contracted tariff for 25 years.

Energy as a second crop

Think about what Component-A actually offers when it works. A farmer with otherwise low-yield or fallow land can host a solar plant and earn a stable, weather-independent income for two and a half decades – either by owning the plant, or by leasing the land to a developer and taking lease rentals plus a share. Unlike a crop, this “harvest” does not fail in a bad monsoon. It does not depend on mandi prices. It is the single most reliable income line a farming family can put on its books.

That is not a welfare outcome. That is an asset-creation outcome. And it is the reason the framing has to shift – in policy, in financing, and frankly in how we in the industry talk about this. We have spent five years selling farmers a cheaper way to irrigate. We should have been selling them a new line of business.

What is actually blocking the income side – and how to clear it

I am not interested in pretending the income side stalled by accident. It stalled because the hard problems live there, and we have not solved them:

Land aggregation.  Component-A needs contiguous parcels, and stitching together multiple small holdings into a viable plot is an execution nightmare on the ground. The practical requirement is modest – a 500 kW plant needs just 2 to 2.5 acres, scaling up to roughly 6 acres for a 2 MW installation at the upper end; but even these thresholds are hard for a single smallholder to meet. The fix is structural: aggregate through Farmer Producer Organisations and cooperatives so the group becomes the developer, not the individual. The farmer who cannot do this alone can absolutely do it as part of fifty.

Equity and financing.  The farmer contribution that is manageable for a pump in Component-B becomes a wall for a megawatt-scale plant in Component-A. We need RESCO and developer-partnership models where the farmer contributes land and earns income without having to raise crores – while still keeping a real share of the upside, not just a thin lease cheque.

Grid evacuation.  A producer is only a producer if the power can leave the farm. Evacuation infrastructure has to be planned into the scheme, not discovered as a constraint after sanctioning.

Reliability of offtake.  Daytime solar and agricultural demand do not always line up. This is exactly why the proposed move to add battery storage and agri-PV models in the next phase matters – it is what converts intermittent generation into a dependable, sellable product.

PM-KUSUM 2.0 has one job

The government has signalled that a second phase is coming, with agro-photovoltaics and storage on the table. Good. But the design test for it is simple, and it is not about megawatts. It is this: does it make farmer income the default outcome, rather than the exception?

Phase one earned its keep by proving adoption. It de-risked the idea of solar on the farm completely. The next phase should not spend its energy convincing farmers to consume more subsidised hardware. It should spend it building the financing, aggregation, evacuation and offtake structures that let a farmer treat his land as a power asset – and bank the income.

We have already shown the country that farmers will adopt. The unfinished work is letting them earn. Get that right, and PM-KUSUM stops being a subsidy scheme that put pumps in fields. It becomes the largest distributed rural-entrepreneurship programme this country has ever run – with the Indian farmer not as a beneficiary of the energy transition, but as one of its producers.

Bhavesh Patidar is the Founder & Group CEO of Nevron Group, a vertically integrated renewable energy infrastructure company headquartered in Indore. He writes on solar deployment, rural energy economics, and India’s clean-energy transition.