01 · Definition
Agriculture and photovoltaics, on the same soil
India faces two problems at once: dependence on imported fossil fuel, and farm incomes exposed to a climate that no longer behaves predictably. Agri-PV is a proposal to treat them as one problem.
A conventional solar park takes land out of cultivation. Agriphotovoltaics does not. Panels are mounted on stilts — around 3.5 metres in the Indian pilots — with wider spacing between rows, so a tractor can pass and a crop can grow underneath. The farmer keeps farming; the array sells power to the distribution company above.
Agronomists measure this with the Land Equivalent Ratio — how much separate land you would need to produce the same crop and the same energy independently. An LER above 1 means co-location beat separation. Indian arid-zone trials, including ICAR-CAZRI's work in Jodhpur, have reported ratios comfortably above 1 for suitable configurations.
There is a physical bonus that is easy to miss: in hot, dry regions the panels shade the soil and cut evaporation, while transpiring plants cool the panels from below — and cooler panels are more efficient. The relationship can run both ways.
The array
Panels sit above the crop rather than instead of it. Spacing and tilt are chosen so enough light still reaches the ground — and transpiring plants below cool the modules, which slightly improves their output.
3.5 metres of clearance
The number that makes Agri-PV different from ordinary solar. Enough height for a tractor, a sprayer and a working adult. It is also what makes the system 15-20% more expensive to build.
The crop below
Shade-tolerant choices do best: chilli, turmeric, leafy vegetables, fodder. In arid zones the shade also cuts soil evaporation. Sun-hungry cereals are the wrong crop for this system.
Meter and grid
A bi-directional meter and a power purchase agreement turn sunlight into a contracted, predictable payment — the income stream that does not care whether the monsoon arrives.
Select a marker on the diagram to read each part.
- 1
Same land
One parcel, two production layers, no acquisition and no land-use change
- 2
Crop production + solar generation
Food from below the array, electricity from above it
- 3
Dual land use → dual income
Farm receipts plus a power purchase agreement
02 · The income case
Why solar behaves like a third crop
Kharif and rabi both depend on the same set of risks: rainfall, pest attack, hail, and a mandi price the farmer discovers only after harvest. Sunlight depends on none of them. A signed power purchase agreement pays the same in a drought year as in a good one.
That is the real argument — not that solar earns more, but that it earns differently. In portfolio terms it is a low-correlation asset added to a household balance sheet that currently holds only high-correlation ones. When the crop fails, the meter keeps running.
03 · Evidence on the ground
Kundanpura, Jaipur: what a 600 kW pilot showed
In Rajasthan, an existing ground-mounted solar plant was retrofitted into an Agri-PV system under the PM-KUSUM framework with ICRIER support. Mounting structures were raised to 3.5 metres so agricultural activity could resume beneath the array. The site — Kundanpura village near Jaipur, described as Rajasthan's first farmer-owned Agri-PV project — now grows chilli and maize under the panels while feeding power to the grid.
The headline is roughly a ten-fold jump in income per acre: from about ₹40,000 under wheat and bajra to close to ₹4 lakh once electricity sales and shade-tolerant horticulture are counted together. The retrofit needed roughly 15% of the total setup cost in additional capital, which ICRIER contributed.
- 600 kWRajasthan Agri-PV pilot capacitysource note
- ≈3.5 mPanel clearance above groundsource note
- ≈₹40,000-41,000/acreFarm income before Agri-PV (wheat and bajra)icrier
- ≈₹4 lakh/acreFarm income with energy sales and shade-tolerant horticulturesource note
04 · The fiscal knot
The ₹2.35 lakh crore that never becomes an asset
This is the dimension that turns Agri-PV from an agronomy story into a public finance story.
Indian agriculture consumes roughly 2,60,000 GWh of electricity a year and pays very little for it. Against an average cost of supply of about ₹8.5 per unit, realisation from agricultural consumers is assumed at around ₹1 — an effective subsidy of about ₹7.5 for every unit pumped. India's total annual power tariff subsidy is estimated at about ₹2.35 lakh crore, with agriculture accounting for a very large share.
Note what that money buys. It buys consumption. It funds a pump running at night on a subsidised feeder, and when the year ends there is no asset on the farm and no improvement on the DISCOM's balance sheet — only a receivable from the state government and, often, a delay in receiving it. The subsidy is recurring, invisible and permanently unproductive.
05 · The reframe
Flipping the farmer from consumer to producer
Farmer → consumer of subsidised electricity
Recurring cost to the state, no asset created
Farmer → producer and consumer of renewable electricity
Income earned, capacity added, subsidy partly self-funding
Two gains that follow for the grid
- Agricultural demand sits at the end of long, lossy feeders; generating power where it is consumed cuts transmission and distribution losses and defers spending on new lines and substations.
- Solar generates in daylight and irrigation pumps mostly want to run in daylight, reducing the need to serve farm feeders at night.
06 · The constraint
If it is this good, why isn't every farmer doing it?
Elevating panels high enough for farm operations, spacing rows wider and building stronger foundations make an Agri-PV installation roughly 15-20% more expensive than a conventional solar project of the same capacity. That premium falls on the party least able to absorb it.
Every one of these is an institutional gap rather than a technological one — which is why the policy answer matters more than the engineering.
07 · The policy instrument
A ₹4.5/kWh feed-in tariff — funded by a subsidy that already exists
A differentiated feed-in tariff of about ₹4.5 per unit for farmer-owned Agri-PV, with targeted capital support — framed not as a new subsidy but as a reallocation of the one already being spent.
Buying a unit from a farmer at ₹4.50 can cost the system less than supplying that farmer a unit at ₹8.50 — and the farmer receives income instead of a handout.
Today the state spends roughly ₹7.5 a unit so a farmer can take electricity. Tomorrow it could spend ₹4.5 a unit so the same farmer can supply it. One is expenditure; the other is procurement — and it builds generating capacity the country needs anyway.
08 · The scheme
PM-KUSUM already has the right component. It is the one that lags.
Launched in 2019, PM-KUSUM aims to add about 34,800 MW of solar capacity with central support of roughly ₹34,422 crore, across three components.
| Component | Purpose | Progress by 2026 | Agri-PV relevance |
|---|---|---|---|
| Component A | Decentralised ground- or stilt-mounted grid-connected plants on farmers' land, up to 2 MW each | ≈1,202 MW installed against 10,000 MW sanctioned (April 2026) | Direct — stilt mounting is already in the design |
| Component B | Standalone solar pumps replacing diesel | ≈11.5 lakh of 13.07 lakh sanctioned — about 88% (June 2026) | Indirect — solarises the pump, not the land |
| Component C | Solarisation of grid-connected pumps, individually and at feeder level | 15,183 individual pumps of 55,392; ≈15.7 lakh feeder-level of 35.4 lakh | Indirect — reduces demand, adds no farmer-owned generation |
PM-KUSUM has succeeded brilliantly as a solar pump distribution programme and struggled as a decentralised generation programme. Component A sits at roughly a tenth of its sanctioned capacity, held back by land aggregation, financial closure and DISCOM procedural delays. More than 21.77 lakh farmers have benefited overall; very few own a generating asset.
Project deadlines have been extended to March 2027 for eligible cases, and a successor programme discussed as PM-KUSUM 2.0 is expected to carry revised targets, with an agrivoltaics allocation reported but not yet formally notified.
09 · The institution
Solar cooperatives: the Amul logic, applied to electrons
A farmer with two acres cannot finance, negotiate or operate a grid-connected power plant. Nor could a farmer with two buffaloes market milk nationally — until aggregation solved it.
-
01
Aggregate smallholders
Contiguous plots pooled into one bankable project footprint
-
02
Mobilise finance
A cooperative balance sheet is lendable in a way an individual marginal farmer's is not
-
03
Improve bargaining power
Negotiating a PPA and evacuation arrangement as one counterparty, not two hundred
-
04
Manage sales and share benefits
Metering, billing, O&M and transparent distribution of proceeds
Existing FPOs are the natural vehicle — they already have legal form, membership, governance and often a credit relationship, removing the slowest step in building an aggregator from scratch.
10 · Intellectual honesty
What the evidence does not yet settle
Recent research is consistent on one point: Agri-PV outcomes are highly context-dependent. The variables interact, and a result from one site does not transfer cleanly to another.
- Crop response to shade
- Leafy vegetables, chilli, turmeric, several fodder crops and some horticulture tolerate or benefit from partial shade; sun-hungry cereals usually do not.
- Panel configuration
- Height, tilt, row spacing and tracking change both energy yield and light reaching the crop, and the two trade off.
- Climate
- In arid Rajasthan reduced evaporation is a gain; in a cooler, cloudier region the same shade is a straightforward loss.
- Local economics
- Tariff, grid distance, cost of capital, labour availability and crop prices can flip viability without any engineering change.
- Long-run agronomy
- Soil health, compaction from structures, pest dynamics and mechanisation under an array need multi-season data India is only beginning to collect.
None of this argues against Agri-PV. It argues against a uniform national template — and for site-specific design standards, crop advisories per agro-climatic zone, and pilots that publish failures alongside successes.
11 · The framework
Remember it as five Es
The 5Es of Agri-PV
- Energy security
Expands domestic renewable generation and reduces fossil fuel imports.
- Extra income
Farmers earn from crops and from electricity, with different risk profiles.
- Efficient land use
The same land produces food and power, avoiding food-versus-energy land conflict.
- Electricity subsidy reform
Farmers move from subsidised consumers towards paid producers.
- Environmental sustainability
Decentralised clean power supporting the 500 GW non-fossil target and Net Zero 2070.
Agriphotovoltaics can transform agricultural land from a single-output production asset into a dual-purpose food-and-energy asset, simultaneously strengthening farm-income resilience and India's energy security.
12 · The balance sheet
What Agri-PV offers, and what it asks for
| Benefit | Challenge |
|---|---|
| Dual use of agricultural land | 15-20% higher system cost |
| Additional, uncorrelated farmer income | Credit products not designed for 20-year assets |
| Clean decentralised electricity | Grid connectivity and evacuation constraints |
| Lower transmission and distribution losses | Small and fragmented holdings |
| Reduced DISCOM subsidy burden | Feed-in tariffs must be set and honoured |
| Greater climate resilience for households | Suitability differs sharply by crop and zone |
| Rural jobs and local renewable capacity | Panel design, O&M and institutional coordination |
13 · Exam corner
For NABARD, UPSC and RBI Grade B
Answer skeleton · 200-250 words
- Open with the reframe: Annadata to Urjadata — the farmer as producer of food and energy.
- Define precisely: dual land use, ~3.5 m stilt mounting, cultivation continues beneath.
- Evidence: the 600 kW Rajasthan pilot, roughly ₹40,000 to ₹4 lakh per acre — with the replicability caveat stated.
- Fiscal core: 2,60,000 GWh, ₹8.5 supply cost against ₹1 realisation, ₹2.35 lakh crore total tariff subsidy.
- Instrument: a ₹4.5/kWh differentiated feed-in tariff as reallocation, not new expenditure.
- Institutions: PM-KUSUM Component A, solar cooperatives and FPOs, rural credit.
- Close with the 5Es and one honest limitation.
Practice questions
"Agri-PV is subsidy reform disguised as a farm scheme." Examine.
Agree, with qualification. The agricultural power subsidy funds consumption and creates no asset; an Agri-PV feed-in tariff converts part of that outflow into procurement of generation the country needs regardless. The qualification: substitution is imperfect because generation and consumption differ in timing and location, existing PPAs bind DISCOM procurement, and withdrawing a farm power subsidy is politically hard. Conclude that Agri-PV makes subsidy reform politically feasible by giving farmers something to gain, rather than achieving it automatically.
Why has PM-KUSUM Component A lagged, and how would you fix it?
Causes: land aggregation difficulty on fragmented holdings, delays in financial closure, weak DISCOM appetite for small decentralised PPAs, high upfront cost, and thin technical extension support. Fixes: aggregation through FPOs and cooperatives with a standard bankable PPA template; dedicated long-tenure refinance from institutions such as NABARD; viability gap funding for the Agri-PV cost premium; assured evacuation at the substation; and zone-specific crop advisories so the agricultural half of the return is protected.
Design a NABARD-supported financing model for cooperative Agri-PV.
Four layers: (i) an FPO or dedicated solar cooperative as borrowing entity, aggregating contiguous plots on long lease from members; (ii) a capital stack of member equity, a viability grant covering the 15-20% Agri-PV premium, and long-tenure refinanced term debt matched to the PPA period; (iii) revenue assignment — tariff receipts escrowed for debt service, surplus distributed alongside crop income; (iv) risk mitigation through a standard PPA, insurance on the array, and an O&M contract with performance guarantees. Add a technical services window for design and crop advisory.
Five figures worth memorising
- ₹8.5/kWh cost of supply against ~₹1 realisation
- ₹2.35 lakh crore annual power tariff subsidy
- 2,60,000 GWh of annual agricultural electricity consumption
- ₹4.5/kWh proposed Agri-PV feed-in tariff
- 15-20% cost premium over conventional solar
14 · Questions readers ask
FAQs
What is agriphotovoltaics (Agri-PV)?
The simultaneous use of one parcel of land for crop cultivation and solar power generation. Panels are mounted on stilts high enough — around 3.5 metres in the Indian pilots — for farm operations to continue underneath. The farmer earns from the crop and from selling electricity to the distribution company.
How much more does an Agri-PV system cost than ordinary solar?
Roughly 15 to 20 per cent more than a conventional ground-mounted plant of the same capacity. The premium buys taller mounting structures, wider row spacing and stronger foundations so that tractors and workers can move beneath the array.
How does Agri-PV reduce India's power subsidy burden?
Agriculture draws roughly 2,60,000 GWh a year at tariffs near ₹1 per unit against an average supply cost of about ₹8.5, implying a subsidy of about ₹7.5 per unit. If a distribution company instead buys farmer-generated solar at around ₹4.5 per unit, the same rupee of public money does more work — the farmer earns rather than merely consumes.
What is PM-KUSUM Component A and why does it matter for Agri-PV?
Component A supports decentralised ground or stilt-mounted grid-connected renewable plants of up to 2 MW on farmers' land. It is the natural home for Agri-PV because stilt mounting is already written into its design, but it is the slowest-moving component — about 1,202 MW installed by April 2026 against 10,000 MW sanctioned.
Do solar panels reduce crop yield?
It depends on the crop and the array. Shade-tolerant horticulture, leafy vegetables, chilli, turmeric and several fodder crops can do well, and partial shade cuts evaporation in arid regions. Sun-hungry cereals generally lose yield. The design brief for a good Agri-PV system is that agricultural activity should at minimum be preserved, and ideally improved.
How is Agri-PV different from rooftop or canal-top solar?
Rooftop and canal-top solar use surfaces that were never productive farmland. Agri-PV shares actively cultivated land between two uses simultaneously, which is what makes it relevant to the food-versus-energy land debate and what makes its economics dependent on agronomy as much as engineering.
Can a small or marginal farmer realistically own an Agri-PV plant?
Individually, rarely — landholding size, capital cost and PPA complexity all work against it. Through a cooperative or FPO that aggregates contiguous plots, negotiates one power purchase agreement and borrows on a collective balance sheet, it becomes plausible. Aggregation is the enabling condition, not a detail.
What happens to the land at the end of the panels' life?
Structures are removable and the land remains agricultural throughout — a key advantage over a conventional solar park, where land use changes outright. The open questions are end-of-life panel recycling and e-waste handling, which India's regulatory framework is still building out.
Glossary
- Agri-PVAgriphotovoltaics
- Simultaneous solar generation and crop cultivation on one parcel of land.
- LERLand Equivalent Ratio
- Land needed to produce the same crop and energy separately, divided by the co-located area. Above 1 means co-location wins.
- Feed-in tariff
- A fixed price at which a utility is obliged to buy electricity from a specified class of generator.
- DISCOMDistribution company
- The electricity distributor — buyer of a farmer's surplus power and bearer of the farm subsidy.
- PM-KUSUMPradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyaan
- The 2019 scheme covering farm solar in three components: decentralised plants, standalone pumps and pump solarisation.
- Stilt mounting
- Raising the array on tall supports so machinery and crops fit underneath.
- PPAPower purchase agreement
- The long-term contract that makes solar income predictable.
- FPOFarmer Producer Organisation
- The aggregation vehicle best placed to hold a cooperative Agri-PV asset.
- Urjadata
- Energy producer — the counterpart to Annadata, food producer, in the framing this article uses.
- Feeder-level solarisationFLS
- Solarising an entire agricultural feeder rather than individual pumps, under PM-KUSUM Component C.
Every figure in this article (22)
| What it measures | Value | Basis |
|---|---|---|
| Panel clearance above ground | ≈3.5 m | source note |
| Rajasthan Agri-PV pilot capacity | 600 kW | source note |
| Farm income before Agri-PV (wheat and bajra) | ≈₹40,000-41,000/acre | icrier |
| Farm income with energy sales and shade-tolerant horticulture | ≈₹4 lakh/acre | source note |
| Additional capital needed to retrofit ground-mounted PV to Agri-PV | ≈15% | icrier |
| Agri-PV cost premium over conventional solar | 15-20% | source note |
| Annual electricity consumption by agriculture | ≈2,60,000 GWh | source note |
| Average cost of supplying electricity | ≈₹8.5/kWh | source note |
| Assumed realisation from agricultural consumers | ≈₹1/kWh | source note |
| Effective subsidy per unit supplied to agriculture | ≈₹7.5/kWh | derived |
| India's annual power tariff subsidy | ≈₹2.35 lakh crore | source note |
| Proposed differentiated feed-in tariff for Agri-PV | ₹4.5/kWh | source note |
| PM-KUSUM solar capacity target | 34,800 MW by March 2026 | mnre |
| PM-KUSUM central financial support | ₹34,422 crore | mnre |
| PM-KUSUM Component A installed capacity | ≈1,202 MW of 10,000 MW sanctioned (April 2026) | mnre |
| PM-KUSUM Component B standalone pumps installed | ≈11.5 lakh of 13.07 lakh sanctioned — 88% (June 2026) | mnre |
| Component C individual pump sets solarised | 15,183 of 55,392 sanctioned | mnre |
| Component C feeder-level solarisation | ≈15.7 lakh of 35.4 lakh sanctioned | mnre |
| Farmers benefited under PM-KUSUM | 21.77 lakh (March 2026) | mnre |
| Extended project completion deadline | 31 March 2027 for eligible projects | mnre |
| India's non-fossil capacity target | 500 GW by 2030 | policy |
| India's net zero target year | Net Zero 2070 | policy |
In summary
The argument in six lines
- Agri-PV keeps land in cultivation. It adds a layer instead of replacing one.
- Solar behaves like a third crop — its value is that it fails at different times than wheat does.
- The Rajasthan pilot showed roughly a ten-fold income jump, under conditions that will not repeat everywhere.
- The real prize is fiscal: ₹4.5 paid to a farmer beats ₹7.5 spent on that farmer.
- PM-KUSUM Component A already has the right design and the worst delivery record.
- Small holdings make cooperatives the enabling condition, not an optional extra.
