PM-KUSUM scheme components A, B and C, explained for EPCs

PM-KUSUM is the biggest farm-solar scheme in India, and most EPCs find it confusing because it is really three schemes in one. This guide gives you the whole map in plain words. By the end you will know what each PM-KUSUM component is, who funds it, and which one fits your business.

What PM-KUSUM is

PM-KUSUM is a central government scheme that brings solar power to Indian farms. The full name is Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan. It is run by the Ministry of New and Renewable Energy (MNRE), but it is delivered by each state nodal agency (SNA) and the local DISCOM. That split matters for you: MNRE sets the broad scheme, but the state writes the tender you bid for.

The goal is simple. Cut diesel use on farms, give farmers cheaper or extra income from solar, and add clean power to the grid. For a solar EPC, PM-KUSUM is a tender-driven business. You do not walk in and claim a subsidy the way a rooftop installer might. You empanel with the SNA, then bid for work. Learn the full path on the PM-KUSUM hub.

The three components at a glance

PM-KUSUM has three components — A, B and C — and Component C splits into C1 and C2. Each one targets a different farm problem and a different kind of EPC. Here is the quick comparison before we go deep on each.

Component A: small plants on farmland

Component A funds small ground-mounted, grid-connected solar plants on farmer or barren land that sell power to the DISCOM. Plants are typically 0.5 MW to 2 MW (verify the current cap with the SNA or live tender). The plant must sit near a substation so the power has a short path to the grid.

Who builds it and who earns

A farmer, a group of farmers, a co-operative, or a developer can own the plant. Many farmers lease their land to a developer instead of building it themselves. The owner signs a long-term power purchase agreement (PPA) — often around 25 years — and the DISCOM buys the power at a fixed tariff set in the tender. For an EPC, Component A is a construction-and-O&M job that looks like any small ground-mount project. Read the deep dive in our Component A developer guide and the money side in Component A tariff economics.

What can go wrong

The two big risks are grid capacity and DISCOM payment. If the nearby substation is full, your plant cannot connect. And the plant only earns if the DISCOM pays on time, so payment security matters — see DISCOM PPA payment security.

Component B: standalone off-grid pumps

Component B funds standalone, off-grid solar water pumps for farmers who have no grid connection at their field. The pump runs straight off solar panels, with no wire to the grid. Common sizes are 3, 5, 7.5 and 10 HP, picked from the farmer's water need and depth. This is the busiest component for most EPCs because the demand is huge and tenders run often.

How an EPC delivers it

You win a tender from the SNA, then install pumps for a list of approved farmers. Each pump uses a universal solar pump controller (USPC) and must meet MNRE technical specs. You collect the farmer's share, install, get the pump accepted, then claim the subsidy. The full path is in our Component B EPC guide, and the farmer paperwork is in farmer eligibility and documents.

Component C: solarising existing pumps

Component C solarises agricultural pumps that are already connected to the grid. There are two ways to do it. C1 (individual pump solarisation) puts solar on one farmer's existing grid pump, so the farmer uses solar by day and can sell surplus power back. C2 (feeder-level solarisation) builds one larger ground plant that powers a whole agricultural feeder, greening many pumps at once.

Why states prefer C2

C2 is rising fast because it is easier for a state to manage one big plant than thousands of small rooftops. Several states run GW-scale feeder tenders. For an EPC, C2 looks a lot like Component A — a ground plant near a substation. The full breakdown is in our Component C guide. For C1 surplus income, net metering rules apply — see net-metering surplus income.

Who pays for what

PM-KUSUM funding is shared three ways: central financial assistance (CFA) from MNRE, a state share, and a farmer share. The exact split changes by component, by state, and by farmer category. Special-category and North-East states often get a higher central share. Do not state one national percentage as a fact — confirm the current slab with the SNA or live tender.

For pumps, the farmer pays a part up front and the two government shares cover the rest. For Component A, there is usually no big subsidy slab — the earning comes from the PPA tariff. The detailed money map is in our subsidy structure explained and state subsidy stacking map.

How EPCs actually get the work

EPCs get PM-KUSUM work in two steps: empanel, then win a tender. First you register and empanel with the state nodal agency. Then you bid in competitive tenders, where the lowest evaluated bid (L1) often wins. This is the part most new EPCs underestimate.

The money you must put up

To bid you submit earnest money (EMD). If you win, you submit a performance bank guarantee (PBG) and take on a typical five-year O&M duty. Miss the timeline and you face liquidated damages. The full money picture is in EMD and PBG financials, and the entry path is in the empanelment process.

Which component fits your EPC

The right component depends on your size, your land access and your cash. Component B suits small EPCs with field crews and steady working capital. Component A and C2 suit firms that can fund a ground plant, secure land and wait for a long PPA. Component C1 sits between the two.

• Small EPC, steady crews — start with Component B pump tenders.
• Land access near a substation — look at Component A or C2.
• Strong balance sheet, patient capital — Component A returns over a long PPA.
• Net-metering experience — Component C1 individual solarisation fits well.

Rules that gate every PM-KUSUM job

A few rules apply across all components and can stop a project cold. Treat each as a checkpoint, not a detail.

• DCR/ALMM content rules — modules and cells must meet domestic-content and approved-list rules. This area is volatile and litigated; confirm against the latest MNRE office memorandum and see DCR/ALMM compliance.
• MNRE technical specifications — pumps, controllers and modules must match the published spec.
• EMD and PBG — no bid or award without them.
• Five-year O&M — you own performance long after install.
• Acceptance test — payment only follows a passed commissioning test.

How SuryaHub helps PM-KUSUM EPCs

PM-KUSUM is paperwork-heavy and deadline-driven, and that is exactly what software is good at. SuryaHub keeps your empanelments, EMDs, PBGs, farmer documents and O&M dates in one place, and runs each job from tender to subsidy claim. The government workflows module tracks every SNA step, and project management keeps installs on the tender timeline so you avoid liquidated damages. SuryaHub is pre-revenue; the only real pilots are Suryantra Energy and RGESPL, and every scheme figure here is a scheme fact to verify, not a guarantee.

Related guides

Frequently asked questions

Sources & references

Component definitions and funding rules come from primary government sources. Every slab, benchmark cost, tariff and timeline is set by MNRE and the states and is revised periodically — confirm the current figure with the state nodal agency or the live tender before you act.

• Ministry of New & Renewable Energy (MNRE) ↗

  PM-KUSUM scheme guidelines, component definitions and benchmark costs.

• PM-KUSUM National Portal ↗

  Scheme dashboard, state allocations and progress data.

• SECI ↗

  Model tender documents and central-level Component A tenders.