Socio-Economic And Environmental Impacts of Solar Energy Adoption in India

Abstract

In the last ten years, the Indian solar energy market has grown rapidly, with installed capacity shooting up from 2.82 GW in 2014 to 150 GW as of early 2026, making solar energy the largest player in the country’s non-fossil fuel energy generation sector. This article reviews the findings on the socio-economic and environmental impacts of solar energy transition. The socio-economic impact encompasses job creation in manufacturing, engineering, procurement, and construction as well as operations and maintenance; savings from electricity consumption for households (including PM Surya Ghar); benefits from rural livelihood initiatives introduced under PM-KUSUM; and the emergence of domestic module manufacturing businesses induced by the establishment of the Production Linked Incentive scheme. Environmental impact includes reduced GHG emissions due to solar energy generation, water savings compared to thermal power generation, and the implications for land use that are being championed through agrivoltaic and floating solar projects. Finally, the research highlights major obstacles to the solar energy transition, including grid integration issues and costs related to financing and disposal of stations that have ceased to operate.