The Ministry of New and Renewable Energy (MNRE) has extended the completion deadline for eligible PM KUSUM scheme projects to March 31, 2027, responding to delays in financial closure caused by constrained lending from banks and financial institutions. The extension applies specifically to projects with power purchase agreements (PPAs) or notices to proceed (NTPs) issued on or before December 31, 2025, across all three components of the scheme.

Extension Details and Eligibility

The deadline extension covers projects under the PM KUSUM scheme that received PPAs or NTPs by December 31, 2025. This represents a one-year extension from the original completion deadline of March 31, 2026. The decision encompasses all three components of the PM KUSUM scheme, providing uniform relief across the program's various project categories.

The MNRE's announcement came after receiving multiple representations from stakeholders who highlighted significant challenges in securing loans within the existing scheme timeline. These stakeholders emphasized the difficulties faced in achieving financial closure due to restricted lending practices by banks and financial institutions.

Coordination with Department of Expenditure

The MNRE stated that it took up the proposal to extend the broader scheme timeline with the Department of Expenditure (DoE). The DoE has indicated that committed liabilities under the current PM KUSUM scheme will be incorporated into the proposed PM KUSUM 2.0 framework, which is currently under development.

This coordination between the MNRE and DoE ensures continuity in the scheme's implementation while preparing for the transition to the next phase of the program. The integration of existing commitments into PM KUSUM 2.0 demonstrates the government's intention to maintain project momentum despite the timeline adjustments.

State Implementation Guidance

Following the DoE's indication regarding PM KUSUM 2.0, states have been advised to actively engage with banks and financial institutions to facilitate financial closure of projects that extend beyond the original deadline of March 31, 2026. This guidance aims to ensure continuity of implementation as the transition to the next phase of the scheme takes shape.

The advisory to states emphasizes the importance of maintaining project development momentum during the transition period. States are expected to work closely with financial institutions to address the lending constraints that prompted the deadline extension in the first place.

Timeline and Transition Planning

The extension provides project developers with an additional year to complete their PM KUSUM projects, moving the deadline from March 31, 2026, to March 31, 2027. This timeline adjustment acknowledges the practical challenges faced by developers in securing necessary financing within the original timeframe.

The announcement indicates that PM KUSUM 2.0 is currently under formulation, suggesting that the government is simultaneously working on the next iteration of the scheme while addressing current implementation challenges. The transition planning ensures that existing projects receive adequate time for completion while preparing for enhanced program features in the upcoming version.

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