MNRE Urges Maharashtra to Withdraw Rooftop Solar Capacity Cap

The Ministry of New and Renewable Energy (MNRE) has asked the Government of Maharashtra to withdraw a recently introduced cap on rooftop solar system capacity, cautioning that the restriction could hinder the growth of distributed solar and undermine national targets under flagship schemes such as PM Surya Ghar: Muft Bijli Yojana.

The issue arises from a change implemented by the Maharashtra State Electricity Distribution Company Ltd. (MSEDCL), which now determines the permissible capacity of rooftop solar systems based on a consumer’s average electricity consumption over the previous 12 months. This marks a departure from the earlier approach, where installations were allowed up to the sanctioned load, enabling consumers to size systems according to future requirements, including electric vehicle charging and increased household or commercial demand.

Industry stakeholders have raised concerns that linking system size to past consumption significantly reduces the eligible capacity for many consumers, particularly those with seasonal usage patterns. Installers and developers argue that the move discourages investment in rooftop solar, limits flexibility for consumers planning future energy needs, and contradicts the Centre’s push to accelerate decentralised renewable energy adoption.

MNRE has reportedly communicated to the state that such restrictions are inconsistent with the broader objective of scaling up rooftop solar capacity across the country. The ministry has been actively promoting residential solar adoption through subsidies and simplified procedures, with a national target of achieving 40 GW of grid-connected rooftop solar capacity.

The policy change has also faced legal scrutiny. In a recent development, the Bombay High Court directed MSEDCL to grant automatic approvals for rooftop solar systems up to 10 kW in line with existing consumer rights provisions, signaling judicial concern over procedural barriers and restrictive practices in the sector.

The development highlights ongoing challenges in India’s rooftop solar segment, where growth has been uneven compared to utility-scale installations due to regulatory inconsistencies and state-level policy variations. Maharashtra, a key solar market, is now under pressure to align its regulations with national objectives aimed at expanding clean, decentralised energy access while ensuring grid stability.