The recent approval of the PM Surya Ghar Muft Bijli Yojana by the Union cabinet represents a transformative leap in India’s commitment to green energy. This ambitious subsidy scheme aims to encourage the installation of solar panels in approximately one crore homes, backed by a substantial allocation of Rs 75,021 crore. In light of this development, there has been a burgeoning demand for rooftop solar solutions. Mumbai-headquartered SolarSquare, founded by a team of IIT alumni, stands at the forefront of this surge, aiding consumers to transition toward solar energy in the residential sector.
During an informative dialogue with Aggam Walia, Shreya Mishra, the co-founder of SolarSquare, delved into various topics, including the catalysts behind the surging demand, the demographics of consumers shifting to solar, and the dynamic transformations within the business.
Mishra explained that the solar industry generally begins its revolution with utility-scale solar through the establishment of large solar parks that inject solar power directly into the grid. Subsequently, the focus shifts to commercial solar applications encompassing factories, warehouses, and large buildings. Historically, the residential segment is the last to see an uptake, but once it gains momentum, it rapidly expands into a significant consumer base. She recalled that in 2020-21, the policy landscape was disorganized and the subsidy mechanisms were dysfunctional. Securing government solar permits was a cumbersome process, often requiring a considerable amount of paperwork and extensive waiting periods.
However, the landscape has dramatically shifted with the introduction of the PM Surya Ghar Yojana. With one unified subsidy and a centralized portal, the process has been streamlined, elevating the standardization and awareness among potential consumers. Since the launch of the National Portal for Rooftop Solar in July 2022 and with ongoing efforts to integrate 70+ DISCOM portals, the procedure to procure permits and subsidies is poised to become seamless. Mishra highlighted that the current demand is so overwhelming that the company finds itself unable to service about 50% of the inquiries due to geographical constraints.
SolarSquare’s journey commenced in 2015 as a B2B enterprise that assisted large-scale corporations, including several Fortune 500 companies, to embrace solar energy. The advent of the Covid-19 pandemic in 2020, augmented by existing subsidies, signaled an opportunity in the residential market. Mishra revealed that the absence of a professional brand addressing consumer concerns regarding installation quality, reliable aftersales support, and accessible financing paths compelled SolarSquare to pivot towards residential solar in 2021. Now, the company operates across 15 Indian cities, employing approximately 400 individuals, with a business model that is heavily weighted towards residential solar, accounting for 80% of its operations.
When it comes to the demographic profile of their clientele, Mishra observed a strong inclination among middle-income families to invest in solar power. Prioritizing the economic benefits of generating free electricity for the next 25 years, many opted for solar energy before considering other significant purchases such as cars or air conditioners. She also noted that new homeowners constitute a substantial customer segment, as well as a considerable number of senior citizens. Mishra interpreted this trend as a reflection of the heightened awareness regarding utility costs and savings among those with fixed incomes, such as retirees.
Mishra also commented on the recontinuation of the government’s shortlist of solar panel manufacturers, known as the Approved List of Models and Manufacturers (ALMM). In her view, while the ALMM is essentially a positive step towards energy independence, it has encountered challenges, including potential short supply and price inflation by domestic manufacturers. However, given the low cost of solar energy, she believes these issues have a negligible impact on demand or the industry. A greater concern lies with policy inconsistencies which can create confusion for both consumers and industry players. She emphasized the importance of adhering to supportive strategies that foster domestic manufacturing while minimizing policy oscillations.
In conclusion, SolarSquare’s success story underscores not only the viability of solar energy but also the critical role of policies and subsidies in accelerating adoption rates. As India marches forward with its green energy objectives, the company’s experiences and insights from industry leaders like Mishra illuminate the possibilities and challenges within this rapidly evolving sector.
