MSKVY 2.0 vs PM-KUSUM: Key Differences, Eligibility, Benefits & Which Scheme Is Right for You?

POLICY & SCHEMES · SLNKO RESEARCH DESK · SCHEME COMPARISON

India's farms have quietly become one of the most important frontiers of the country's energy transition. Agriculture consumes a large share of state electricity, much of it subsidised and supplied at night, which strains distribution companies and inconveniences farmers. To fix this, the government has launched several decentralised solar schemes - and when developers, investors and landowners start comparing them, two names dominate the search results: MSKVY 2.0 vs PM-KUSUM.

The two are easy to confuse. Both talk about "agricultural feeder solarization," both promise a role for solar developers, and both aim to put clean, daytime power onto farm feeders. But they were built for different purposes, run by different authorities, and reward very different players. In fact, MSKVY 2.0 began life inside PM-KUSUM before Maharashtra scaled it into something much larger.

This guide breaks both schemes down in plain language - what they are, who is eligible, how the money flows, and which one actually fits your profile, whether you are a developer, an EPC/EPCM firm, an IPP, an investor, a landowner, an industrial consumer or a farmer.

Key takeaway: PM-KUSUM is a national, subsidy-driven, farmer-first scheme with three components. MSKVY 2.0 is a Maharashtra-only, developer-and-utility-scale procurement programme with no central subsidy on its MoU route. They overlap in intent but serve different players.

01 What is MSKVY 2.0?

MSKVY 2.0 (Mukhyamantri Saur Krishi Vahini Yojana 2.0) is a Maharashtra government scheme, run by MSEDCL, to install about 16,000 MW of decentralised ground-mounted solar near agricultural substations and supply daytime power to farm feeders under 25-year power purchase agreements.

Objective. The scheme's core goal is to solarise agricultural feeders across Maharashtra so farmers receive reliable daytime supply, while reducing MSEDCL's cost of serving agriculture and its cross-subsidy burden.

Implementing authority. MSEDCL is the buyer, with MSEB Solar Agro Power Limited (MSAPL) acting as nodal agency and MEDA providing facilitation. State coverage is Maharashtra only.

Project type and capacity. Grid-connected, ground-mounted solar plants of 0.5 MW to 25 MW, sited within 5–10 km of agriculture-dominated substations.

Eligibility. Access is gated by financial strength rather than a track record - broadly a net worth of ₹1 crore per MW and a liquidity test (turnover or PBDIT per MW). There is no minimum-experience requirement. For thresholds, documents and the application flow, see MSKVY 2.0 MoU route eligibility.

PPA and revenue model. Private developers build, own and operate the plant; MSEDCL is the long-term off-taker under a 25-year PPA, providing a stable, annuity-like revenue stream at a MERC-governed tariff. Selection happens either through competitive bidding or a first-come-first-served MoU route.

Status and outlook. MSKVY 2.0 is one of India's largest distributed-solar programmes and is actively awarding capacity toward its 16,000 MW target. Notably, Maharashtra has de-linked the scheme from PM-KUSUM's central-subsidy framework on its newer tranches - a signal that the state intends to run this as a self-standing, at-scale procurement engine.

02 What is PM-KUSUM?

PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyaan) is a national MNRE scheme launched in 2019 to add about 34,800 MW of farm-based solar by March 2026 through three components - decentralised solar plants, standalone solar pumps and grid-connected pump solarisation.

Objective. PM-KUSUM aims to give farmers energy and water security, cut diesel use, and turn the farmer from a food producer (annadata) into an energy producer (urjadata).

The three components:

• Component A - setting up 10,000 MW of decentralised, grid-connected solar plants of 0.5 to 2 MW on barren, fallow or agricultural land. Owners sell power to the DISCOM at a feed-in tariff.
• Component B - installing 14 lakh standalone, off-grid solar pumps (typically up to 7.5 HP) for farmers without grid access.
• Component C - solarising 35 lakh grid-connected agricultural pumps, through either Individual Pump Solarization (IPS) or Feeder Level Solarization (FLS). FLS is the piece MNRE now sees as most scalable, and it is the conceptual parent of MSKVY 2.0.

Subsidy structure. This is PM-KUSUM's defining feature. For standalone pumps (B) and individual pump solarisation (C-IPS), the cost is typically split 30% central financial assistance (CFA) + 30% state subsidy + 40% farmer, with the farmer often paying just 10% upfront and financing the rest. Special-category states (North-East, hilly, islands) get higher CFA.

Participation and revenue. Farmers, cooperatives, panchayats, FPOs and Water User Associations can participate directly or bring in developers - especially for Component A and feeder-level Component C. Farmers earn through diesel savings (B), reduced bills plus surplus sales (C), or tariff income and land lease (A).

Status and roadmap. As of November 2025, about 10,203 MW had been installed across all components for roughly ₹7,106 crore, against a total central outlay of ₹34,422 crore. Confirm current figures against MNRE's latest dashboard before modelling. The current phase runs to March 2026, with a commissioning extension to March 2027 for projects whose PPAs were signed before December 2025. A successor programme - informally PM-KUSUM 2.0, with a sharper feeder-solarisation and agrivoltaics focus - is expected but not yet formally notified.

03 A few definitions worth bookmarking

Agricultural feeder solarization - connecting a dedicated solar plant to the substation or feeder that supplies farm pumps, so agricultural consumers get reliable daytime solar power instead of subsidised, often night-time, grid supply.

Power Purchase Agreement (PPA) - a long-term contract in which a generator sells electricity to a buyer (usually a DISCOM) at an agreed tariff for a fixed period, typically 25 years for solar.

[Captive solar](/media/blogs/open-access-models-third-party-captive-group-captive) - a plant built mainly to supply the owner's own consumption (for example, a factory's own load) rather than to sell power to a DISCOM.

[Open access solar](/media/blogs/open-access-explained-part-1) - an arrangement that lets a large consumer buy power from a third-party solar plant located elsewhere, wheeling it through the grid against a defined set of charges. How those charges stack is covered in our open access cost stack guide.

These matter because industrial buyers often compare government feeder schemes with captive and open access routes - a point we return to below.

04 Detailed comparison: MSKVY 2.0 vs PM-KUSUM

MSKVY eligibility on the MoU route is a financial gate - net worth of ₹1 crore per MW plus a liquidity test. See the full eligibility, documents and fees guide before you model capacity.

05 Key differences explained

Rather than repeat the table, it helps to understand why these schemes look so different.

They were built to solve different problems. PM-KUSUM is a rural-development instrument first and an energy programme second. Its job is to lift farmer incomes, replace diesel, and spread solar across millions of small sites nationwide - so it leans heavily on subsidy. MSKVY 2.0 is a procurement programme: Maharashtra needs tens of gigawatts of cheap daytime power fast, so it hands the job to private capital at utility scale and skips the subsidy.

Developer perspective. MSKVY 2.0 is the bigger, cleaner opportunity - standard 0.5–25 MW blocks, one creditworthy off-taker, a 25-year PPA and a defined process. PM-KUSUM's Component A and feeder-level Component C also offer developer projects, but they are smaller, more fragmented and more dependent on state-level execution.

Farmer perspective. PM-KUSUM wins outright. It is the only one of the two designed to put an asset - a pump or a plant - directly in a farmer's hands with heavy subsidy support. MSKVY 2.0 benefits farmers indirectly, through better feeder supply, but does not make them owners.

Investor perspective. MSKVY 2.0 offers predictable, annuity-style cash flows backed by a long PPA - attractive for infrastructure and yield investors. PM-KUSUM's returns can be strong per project because of subsidy, but small ticket sizes and administrative complexity make aggregation harder.

Industrial and government perspective. Neither scheme is a self-supply route - both sell power to or through the DISCOM, so a factory wanting to cut its own bill is better served by captive or open access solar. For the government, the two are complementary: PM-KUSUM delivers rural equity and diesel displacement, while MSKVY 2.0 delivers volume and speed.

06 Which scheme should you choose?

If you are a farmer or landowner: PM-KUSUM is almost always the right door. Component B or C can solarise your pump with heavy subsidy, and Component A (or leasing land for it) can create rental or generation income. You can also lease land to an MSKVY 2.0 developer for steady rent without taking on project risk. Start with our PM-KUSUM overview.

If you are a solar developer or IPP: MSKVY 2.0 offers the larger, more bankable pipeline, with clean utility-scale blocks and a 25-year MSEDCL PPA. Keep PM-KUSUM Component A and feeder-level Component C in your pipeline too, especially outside Maharashtra. Read the MSKVY 2.0 scheme overview and the MoU eligibility guide.

If you are an EPC or EPCM company: both are strong markets. MSKVY 2.0 brings sizeable, standardised EPC/EPCM mandates; PM-KUSUM brings high-volume, distributed installation and O&M work across many states. How you contract that work matters - see Solar EPC vs EPCM.

If you are an investor: MSKVY 2.0 suits infrastructure and yield strategies through its long, stable PPAs. PM-KUSUM suits those comfortable aggregating smaller, subsidy-enhanced assets.

If you are an industrial consumer: look past both for self-supply. Evaluate captive solar or open access solar instead, which are designed to reduce your own energy cost rather than sell to the grid.

Ready to choose a path?

• Developers / IPPs: send us your target district, capacity and land position for an MSKVY or PM-KUSUM read - Talk to our team.
• Investors: we can walk through offtake quality, SCOD risk and portfolio construction before capital is committed - Talk to our team.
• EPC / EPCM firms: comparing delivery models for multi-site farm solar? Start with Solar EPC vs EPCM, or discuss Global EPC-M.
• Farmers / landowners: for pump solarisation or land lease options under PM-KUSUM, start here or contact us.

Phone: +91 62025 28672 | WhatsApp: +91 87962 60069 | Email: Contact us

07 Future outlook

Both schemes sit inside a much bigger national ambition: 500 GW of non-fossil capacity by 2030, with decentralised, farm-level solar as a core pillar.

Agricultural feeder solarization is set to accelerate. MNRE has signalled that feeder-level solarisation is the most scalable part of PM-KUSUM, and a successor PM-KUSUM 2.0 - with a larger budget and an agrivoltaics component - is widely expected. In parallel, states are likely to follow Maharashtra's lead and run their own large distributed-solar programmes, giving DISCOMs a central role as long-term off-takers. Private investment will keep flowing toward the utility-scale, PPA-backed end of the market, while subsidy-supported schemes broaden farmer participation.

Many organisations will pursue both routes in parallel - MSKVY 2.0 for Maharashtra utility-scale offtake and PM-KUSUM for farmer or multi-state exposure - so scheme choice is not always either/or. Implementation details evolve with new government notifications. Always verify the latest guidelines and tariffs from official authorities before committing to a project.

Ready to move on a project?

Choosing between MSKVY 2.0 and PM-KUSUM - or pursuing both - comes down to your capital, land, risk appetite and execution capability. SLNKO is an engineering-led EPCM partner with over 9.2 GW delivered across utility-scale, C&I and government solar. From scheme selection and eligibility structuring to substation strategy, procurement, execution and long-term O&M, we help developers, investors and industrial clients turn policy into commissioned assets.

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Phone: +91 62025 28672 | WhatsApp: +91 87962 60069 | Email: Contact us

Frequently Asked Questions

Scheme terms, targets and subsidies are set by MSEDCL, MERC, MNRE and state nodal agencies and may be revised. Verify current figures against official documents before making commercial decisions.