Rooftop solar and the PM-KUSUM scheme are emerging as major contributors to India’s solar capacity expansion in FY27, accounting for around 40% of additions through July, according to Bernstein.
The rising contribution from decentralised solar projects comes as transmission constraints slow the development of large utility-scale renewable energy projects. With grid infrastructure struggling to keep pace with new generation capacity, smaller distributed projects are gaining a larger share of India’s solar growth.
Rooftop and PM-KUSUM projects accounted for about 22% of India’s solar capacity additions in FY26. During the year, India added approximately 45 GW of solar capacity and 6 GW of wind capacity, compared with 24 GW of solar capacity added in FY25.
Bernstein expects the role of decentralised solar to increase further in FY27, with rooftop installations and PM-KUSUM projects contributing a significantly larger portion of new capacity.
The PM-KUSUM programme has become an important mechanism for expanding distributed solar generation, particularly in the agricultural sector. The scheme supports solar-powered agricultural infrastructure and decentralised renewable energy projects.
India’s utility-scale renewable projects rely heavily on transmission networks to transport electricity from generation centres to major consumption areas. Limited transmission availability can delay project commissioning and restrict the pace at which new large-scale solar and wind capacity is brought online.
Bernstein expects renewable energy capacity additions to plateau or moderate over the next one to two years as transmission infrastructure catches up with generation capacity.
This could lead to a continued shift in the composition of India’s renewable energy additions, with smaller, decentralised projects potentially playing a greater role in overall capacity growth.
The government is also accelerating residential rooftop solar deployment through the PM Surya Ghar scheme. The programme targets rooftop solar installations across 10 million households, with a combined capacity goal of 30 GW by the end of the financial year.
The growing contribution of rooftop solar and PM-KUSUM highlights the changing structure of India’s renewable energy market. While utility-scale projects remain central to the country’s clean energy ambitions, decentralised solar could become increasingly important as India works to overcome transmission constraints and expand renewable power generation.





