Rooftop solar (RTS) represents a critical component of India’s clean energy transition, offering decentralized

generation, reduced transmission losses, and potential resilience benefits. Yet, despite ambitious national targets

and substantial technical potential, RTS adoption has lagged behind expectations. This narrative review

environment constraints. At the same time, innovations such as simplified subsidy pipelines, digitalized approval

portals, DISCOM performance incentives, vendor certification, and emerging business models including

RESCO/OPEX and group or virtual net metering demonstrate viable pathways to expand adoption. The review

identifies future research needs in program evaluation, financial innovation, grid integration, apartment

governance, and quality assurance, and emphasizes the importance of stable regulatory frameworks, inclusive

finance, and community-oriented models.

Rooftop solar (RTS) systems represent one of the most promising pathways for India to achieve its clean energy

and decarbonization goals. By generating power closer to the point of consumption, RTS not only reduces

National Solar Mission [2]. Recognizing this shortfall, policymakers initiated a series of post-2022 reforms,

including enhanced subsidy structures, performance-based incentives for distribution companies (DISCOMs),

and digitalized application processes. These interventions, along with the launch of flagship programs such as

the PM Surya Ghar: Muft Bijli Yojana, have contributed to renewed momentum in the residential sector [7].

Nevertheless, adoption remains highly uneven across states, consumer classes, and urban forms. Variations in

state-level regulatory frameworks, differences in credit access, and heterogeneity in built environments shape

the pace and scale of RTS diffusion. For example, while states such as Gujarat and Maharashtra have recorded

substantial growth, others continue to face persistent barriers in financing, consumer awareness, and utility

engagement [7].

This review synthesizes recent empirical and policy evidence to examine the enablers and constraints shaping

The Ministry of New and Renewable Energy (MNRE) has implemented several flagship initiatives to accelerate

rooftop solar (RTS) deployment. The Grid-Connected Rooftop Solar Programme (Phase II) was an early

intervention that provided central financial assistance for residential consumers and introduced performance-

based incentives to align distribution companies (DISCOMs) with installation targets. While uptake under this

scheme was moderate, it laid the foundation for subsequent reforms [3].

In 2024, the government launched the PM Surya Ghar: Muft Bijli Yojana, representing a major policy milestone

to offset consumption with rooftop generation, continues to be the most decisive factor influencing household

payback periods. The Electricity (Rights of Consumers) Rules, 2020, mandated net metering for systems up to

500 kW, bringing greater uniformity. However, several states adopted variations such as net billing and gross

metering for larger capacities, creating regulatory uncertainty and inconsistent financial returns [3].

Recent innovations, such as group net metering and virtual net metering, are gradually being introduced to

address constraints in apartments and shared-roof contexts. Yet, their operationalization remains uneven across

states, with only a handful demonstrating effective implementation [7]. This heterogeneity underscores the need

for harmonized regulatory frameworks that balance DISCOM concerns with consumer incentives.

State-level regulations play a decisive role in shaping adoption outcomes. Decisions on capacity caps,

dissatisfaction and discourage prospective adopters [1]. The contrast highlights that effective policy design must

not only focus on subsidies but also on institutional incentives and accountability mechanisms for DISCOMs,

which remain the most critical intermediaries in rooftop solar diffusion.

Rooftop solar adoption in India has historically been concentrated in the commercial and industrial (C&I) sector,

where higher electricity tariffs, larger rooftop availability, and greater access to institutional credit created

favorable economic conditions. By contrast, the residential segment remained marginal through the early 2020s

despite capital subsidies, primarily due to affordability constraints, limited credit access, and lower levels of

consumer awareness [8, 2]. The cumulative effect of these structural barriers was a slow pace of residential

diffusion; even as C&I users drove steady expansion in the overall rooftop segment.

potential of over 200 GW [3].

The geographical distribution of adoption remains highly uneven. Five states, Gujarat, Maharashtra, Rajasthan,

Kerala, and Tamil Nadu, account for nearly 70 percent of all rooftop capacity, underscoring the concentration

of diffusion in particular regions [7]. Gujarat stands out for its aggressive Surya Gujarat program, which enabled

the state to account for more than 60 percent of India’s cumulative residential rooftop capacity by FY2022 [1].

By contrast, several populous states such as Uttar Pradesh and Bihar have continued to lag due to limited policy

innovation, bureaucratic bottlenecks, and weaker vendor ecosystems [9].

The South Indian states present a particularly instructive case in the diversity of adoption trajectories. Tamil

Nadu has historically emphasized utility-scale solar projects, but rooftop adoption has grown only modestly,

with urban centers such as Chennai and Coimbatore leading deployment. Regulatory charges and intermittent

systems remain underdeveloped. Initiatives targeting agricultural feeders and public institutions have emerged,

but residential adoption continues to face challenges related to awareness and procedural delays [8]. Telangana,

meanwhile, has recorded moderate growth, especially in institutional and educational buildings around

Hyderabad, though overall diffusion is constrained by limited installer networks and slower uptake in peri-urban

and rural areas [7]. Kerala represents a distinct case. Despite relatively high consumer awareness, the state faces

structural constraints such as small roof sizes, shading, and monsoon-heavy conditions that reduce effective

generation potential. The Kerala State Electricity Board’s SOURA program, which installs and manages rooftop

systems directly on consumer premises, represents an innovative model aimed at overcoming consumer

hesitancy. Yet qualitative evidence suggests that households remain concerned about long-term maintenance

and reliability, which continues to dampen adoption despite favorable attitudes [5].

state regulatory frameworks, coupled with improved DISCOM incentives and consumer outreach, will be critical

to expanding adoption beyond current hotspots [7, 2].

The literature consistently identifies a set of interlinked financial, regulatory, procedural, informational, and

structural barriers that constrain the widespread diffusion of rooftop solar in India. Although the nature and

severity of these barriers vary across consumer segments and states, together they create a persistent gap between

technical potential and realized capacity.

High upfront costs remain the most significant obstacle for residential households. Even after accounting for

central financial assistance and state-level subsidies, many low- and middle-income consumers report

transformer limits increase perceived investment risk and discourage both households and businesses from

committing to rooftop solar [3]. The C&I segment, in particular, has faced disincentives when favorable net-

metering arrangements were replaced with less attractive net-billing or gross metering models. Such regulatory

uncertainty not only undermines investor confidence but also complicates financial planning and contract

negotiations [7].

Information asymmetries and consumer perceptions further inhibit adoption. Households often lack reliable

knowledge about installation costs, subsidy entitlements, procedural requirements, and the long-term

maintenance needs of rooftop systems. Misconceptions about roof damage, structural integrity, and technical

One of the most effective enablers has been the move toward simple, slab-based subsidy structures. Under the

PM Surya Ghar: Muft Bijli Yojana, households are offered transparent and predictable subsidy amounts, linked

streamlined digital pipelines not only accelerate installations but also enhance transparency by allowing

Another critical innovation lies in the introduction of performance-linked incentives for distribution companies

(DISCOMs). Historically, DISCOMs were reluctant to support rooftop solar due to concerns over revenue

erosion. By linking central incentives to DISCOM performance on parameters such as timely application

approvals and verified system commissioning, policymakers have created a mechanism that aligns utility

interests with consumer adoption [8]. This institutional realignment is widely regarded as essential to scaling

Program designs have also emphasized the importance of vendor empanelment and quality assurance. Requiring

vendors to meet minimum technical standards, undergo training, and provide after-sales service guarantees

burden and distribute costs across predictable repayment schedules, making rooftop solar more inclusive and

socially equitable [8].

relatively higher [8]. By contrast, the residential segment has seen limited OPEX penetration due to small system

system to be apportioned across multiple consumer accounts, while virtual net metering enables consumers to

subscribe to a share of an off-site solar installation and receive credits against their electricity bills. Community

solar projects and utility-aggregated offerings fall within this category, pooling demand and spreading both costs

deployed in India. While CAPEX continues to dominate the residential landscape, OPEX models are crucial for