Beyond the Energy-Agriculture Binary: How Agriphotovoltaics Can Transform India's Rural Economy through PM KUSUM

Abstract

India’s agricultural subsidy regime presents a paradox: it reflects distorted power subsidies that incentivise unmetered groundwater pumping, leading to an overexploitation problem in many parts of India. Concurrently, India’s transition to clean energy is gaining momentum toward the 500 GW target by 2030. Large-scale solar expansion through ground-mounted systems on farmland has provided energy opportunities at the cost of agricultural production, thereby creating land-use competition. This paper argues that Agriphotovoltaics (APV) can act as a strategic solution to transcend this false binary by enabling dual land use for both crop cultivation and solar generation. Drawing on two types of APV business models from Rajasthan and Delhi, this paper shows that farmer-centric APV models under PM KUSUM Component A can yield returns per acre of 9-10 times those of conventional farming. However, developer-led models risk reducing farmers to passive landlords. Currently, in India, scaling APV models is being constrained by definitional ambiguities, inadequate financial instruments, and institutional fragmentation. We propose a four-pillar policy framework: farmer-centric technical specifications and technical standards, a better financial architecture through targeted capital subsidies, strengthening farmer-producer organisations to facilitate collective ownership models, and finally, region-specific agronomic research. Such a framework will ensure that APV becomes a mainstream livelihood solution, supporting energy security and the agricultural sustainability of Indian farmers.