When the PM Surya Ghar Muft Bijli Yojana was launched, it carried a bold promise. The goal was to help 10 million Indian households become prosumers through rooftop solar systems by March 2027.  

However, over a year into its rollout, the program faces a critical roadblock. A severe shortage of solar modules that meet Domestic Content Requirements (DCR) continues to hinder its progress and threaten the realization of its long-term objectives. 

This issue has resurfaced at a time when the program’s slow progress has already drawn serious concern from the Parliament’s Standing Committee on Energy. In a recent report, the committee highlighted the Ministry of New and Renewable Energy’s struggle to meet its target of installing 3.5 million rooftop systems in FY 2026. “Given the current pace of installations, achieving the target of FY26 will be challenging for the Ministry,” the committee noted. 

The latest available data shows that just over a million households have benefited from the program. This figure falls significantly short of the upcoming FY26 target, nearly three and a half times higher. The growing gap between targets and actual progress underscores the seriousness of the situation. 

The continuing module supply crunch is slowing down rooftop installations, disrupting supply chains, halting vendor operations, and delaying approved projects in several states.  

Industry insiders describe the problem as systemic, affecting every level of implementation. Without timely corrective measures, the program’s ambitious goals could gradually drift further out of reach. 

Deep Supply Crisis  

Terence Alex, Founder & CEO of  Wattsun Energy, underscored the extent of the crisis. Nearly 80–90% of Indian manufacturers who make DCR cells have halted domestic supply to prioritize exports, especially to markets like the U.S., for higher profits. 

Despite government encouragement to meet domestic needs, manufacturers opt for export contracts. As a result, domestic project developers and vendors cannot access essential DCR modules. 

An exporter told Mercom that due to high import tariffs imposed by the U.S. on countries like Cambodia, Vietnam, and Thailand, demand for Indian solar modules has increased. India faces comparatively lower duties. This shift has made exporting more lucrative for Indian manufacturers, with margins as high as 50%, double that of the domestic market. 

“Even distributors see better profit margins of 25%–30% through exports compared to margins of 10%–12% in local sales,” he added. 

Ajay Yadav, President of the Renewable Energy Association of Rajasthan, echoed these concerns. “Distributors have confirmed they’re not receiving enough stock. Manufacturing capacity is insufficient to meet government targets of 25 GW—it is not feasible just because it’s been announced.” 

Yadav also emphasized customer frustration when loans were sanctioned and EMIs kicked in, but installations could not proceed due to the unavailability of modules. In many cases, installers are forced to swap brands or ask clients to wait indefinitely. 

This shortage is particularly damaging because the PM Surya Ghar program is closely tied to DCR compliance. Even though the Ministry of New and Renewable Energy (MNRE) guidelines permit using non-DCR modules for unsubsidized, grid-connected systems, the portal does not support such configurations. This disconnect between policy and implementation tools is slowing down the program. 

However, solar cell manufacturers maintain there is an adequate amount of DCR cells available in the market and that exports to the U.S. have dropped as many solar projects have been put on hold as the Trump administration makes changes to U.S. renewable energy policies.  

They note that all the major DCR cell manufacturers have their entire production quantity booked. When it comes to the shortage of DCR modules, they blame last-mile market forces. “Large-scale EPC players, especially those who are developing projects under the PM KUSUM program, are procuring huge quantities of DCR modules and are causing the shortage.” Project capacities under the KUSUM program are far higher than those for rooftop solar projects. 

Trust Erosion 

The stress on supply is also causing questionable practices in the industry. Some manufacturers now require vendors to purchase full kits, including inverters and other components, to access DCR modules. This requirement limits the freedom to choose system components individually and increases the financial burden on installers. 

An installer who preferred to stay anonymous spoke about companies using intermediary shell entities to handle sales, distancing themselves from warranty obligations. This development makes it difficult for end users to claim after-sales services and risks erosion of trust in the entire rooftop solar ecosystem. 

Rising Costs and Changing Preferences 

Cost is another growing concern. Installers claim that DCR modules now have a premium of up to ₹12 (~$0.14) more per watt than non-DCR ones. For many customers, especially those with larger installations, the price difference outweighs the ₹78,000 (~$914) subsidy.  

Alex noted that customers are often told about a two-month wait for DCR modules. Many choose to proceed with non-DCR systems instead, accepting the loss of subsidy in exchange for quicker installations. 

Prices have climbed following the government’s decision to impose provisional anti-dumping duties on solar glass imports from China and Vietnam. Module manufacturers say the cost pressures are also linked to logistical challenges and the fragmented nature of India’s manufacturing ecosystem. Unlike China, which benefits from centralized production and scale, India’s producers struggle to keep up with demand. 

They argue that China has a centralized manufacturing model and leverages its vast production capacities and an efficient supply channel across the solar value chain, allowing it to sell modules at far lower prices. 

Installers have also pointed out that these figures used to calculate the benchmark cost are 20 to 30% lower than actual market rates. Though the program’s guidelines allow for a mid-term review of these benchmarks, especially if prices rise significantly, the Ministry of New and Renewable Energy has yet to take a call. 

Voices across the industry agree that urgent government intervention is needed. Alex stressed that manufacturers should be required to prioritize domestic demand before turning to export markets. He warned that the program’s ambitious goals will remain out of reach without such a mandate.