We're measuring rooftop solar by the wrong number

**Akshara** (0:04)
In today's episode, we'll break down two important stories. First, we'll talk about India's rooftop solar problem. And then we'll talk about what happened to the world's electricity in 2025
Welcome back to The Daily Brief by Zerodha, where we cut through the noise to help you understand what's actually happening in the most important stories from business and markets. I'm your host Akshara. Today is Tuesday, 9th June. Coming to the first story.
For years, there was one story we told ourselves about rooftop solar in India, that Indians didn't know enough about it or didn't trust it. They found it too expensive, too complicated, too foreign.
Now, this pointed to one answer. If only we could get the word out, running campaigns and explaining the savings it could fetch, adoption would follow. But that story, it turned out, was mostly wrong. The truth is more interesting as we learned from two new reports from the Council on Energy, Environment and Water, or CEEW. One on what drives household decisions to install rooftop solar, the other on what happens to the system once it's up there. So, here's the short version. India has nearly solved the demand problem. People know about rooftop solar and a lot of them want it. What it hasn't solved, however, are two gaps sitting on either side of that desire. One, the gap between wanting solar and actually installing it, and two, the gap between installing it and actually generating power from it. Both of these gaps often seem invisible, because the only number anyone usually quotes is installed capacity, which tells you nothing about either. Without fixing them, however, we're likely to find our solar ambitions stuck. Let's walk through both. So, when you hear about Indians not installing enough solar panels on their roofs, one's impulse is to assume that there isn't enough awareness or willingness to make such a shift. So, to test this, CEEW went to 17,000 households from 308 districts across India. Their survey demolished the notion. Indians clearly know about rooftop solar installations and their merits. Around 57% of the households they surveyed were specifically aware that this was an option available to them. Moreover, roughly a quarter of all the households they surveyed were willing to install solar panels on their rooftops. And not just that, even among the 43% of respondents that didn't know about this option, roughly half were willing to adopt the technology once it was explained to them. But if there was so much interest, where did the problem come from? As the survey found, of every 10 households that are willing to go solar, 8 never even begin the process. That's an 80% drop-off rate between interest and action. It's the main leak that keeps solar adoption at bay. The point where a household is supposed to turn intent into action is the one where they instead check out. So this raises the two questions we'll try to answer through the rest of this story.
One, what's stopping willing households from installing solar panels? And two, assume they do install them. Do those installations actually work the way they're supposed to? Put yourself in the shoes of a family that's ready and willing to make the leap.
What would stop you?
Money? Availability? Logistical challenges?
The biggest reason, once cited by roughly 68% of everyone they surveyed, was that they simply don't know how to begin. The entire process is a fog. Simple questions like what the first step is, who you call, where you sign up, have no clear, well-publicized answers. Now, that changes how you would address the problem of low interest. If affordability were the problem, you would try coming up with schemes to make it more attractive. And that's what we've done with subsidy schemes like PM Surya Ghar, Mufti Bijli Yojana.
But the actual problem is more basic. People know that rooftop solar installations are a problem, but they know little else about it. Only 12% of those who knew about rooftop solar as a concept, for instance, knew that the first step in this journey is to register on a national portal. Without simple process knowledge being widely available, everything else falls flat. Now, in some ways, this is good news. Fixing an informational barrier is relatively cheap, and we don't, for instance, need to pump another few thousand crores in subsidies before we can make a dent. As the CEEW says, the gap is entirely recoverable through targeted communication. A single well-designed hand-holding campaign could move more people into rooftop solar than a massive round of subsidy hikes. So what does a success case look like? How did the roughly 1.4% actually installed solar panels get there? Well, there's one thing they have in common. They're rich. Adoption among high-income households runs at about roughly 10 times the rate among low-income ones. The typical adopter has an electricity bill about 50% higher than a non-adopter and runs a much heavier load of appliances like air conditioners or geysers. For these people, the economics is a no-brainer. They need more electricity which would otherwise generate higher bills, but a solar installation can cut through those bills fast. But unfortunately, rooftop solar spreads largely by word of mouth. And word of mouth travels within social networks, and social networks largely cluster by income. If the only pool of adopters is overwhelmingly wealthy and high-consuming, those are the only people to whom word can spread. Left to its own devices, that gap will only widen with rooftop solar circulating within the affluent, while quietly skipping the low-income and rural households the policy should reach. Within those affluent adopters, though, adoption is underpowered. The PMSGUI subsidy is capped at a 3-kilowatt system, and this creates bad incentives. Even though most adopters' actual electricity needs are larger than 3-kilowatt, they deliberately undersize their systems to make the most of the subsidy.