What Is CFA in Solar? PM Surya Ghar vs CFA Subsidy

EPC sales teams often confuse "PM Surya Ghar" with "the CFA scheme", or tell a commercial customer they are eligible for PM Surya Ghar when they are not. The confusion is understandable: both come from the central government, both involve solar panels, and both get called "solar subsidy". A useful starting point is that CFA (Central Financial Assistance) is the name of the subsidy under PM Surya Ghar itself, and earlier programmes such as the Grid Connected Rooftop Solar Programme Phase II also used the term, with different rules.

This guide compares PM Surya Ghar Muft Bijli Yojana (the residential rooftop scheme, checked against the MNRE guidelines on 31 Oct 2026) with older and other CFA-type programmes, and is open about where we could not verify current rules. By the end, your sales team will know in 90 seconds which programme to pitch to which customer, and why.

Understanding this distinction is not just helpful for your team, it's a qualification filter. The right subsidy route is part of qualifying solar leads correctly, before you invest time in a site survey or detailed proposal.

PM Surya Ghar and CFA, The 30-Second Version

PM Surya Ghar Muft Bijli Yojana was launched in February 2024 by the Government of India under the Ministry of New and Renewable Energy (MNRE). Its full name translates to "Free Electricity Home Scheme." It is a demand-side subsidy: the CFA goes to the consumer (to the consumer's account, or to the loan account if the consumer took a loan) to reduce the cost of installing rooftop solar. If you're unfamiliar with the programme itself, it's worth first understanding what PM Surya Ghar Yojana actually is before comparing it against other CFA programmes.

CFA, Central Financial Assistance, is the term MNRE uses for capital subsidy across several schemes. Under PM Surya Ghar it is paid to the consumer, not the vendor (clause 6(p)). The earlier Grid Connected Rooftop Solar Programme Phase II also used CFA, and the PM Surya Ghar guidelines refer to it as a prior scheme (clause 5(n)). Which non-residential programmes, if any, currently accept new CFA applications, and through which agencies (Solar Energy Corporation of India (SECI) or state nodal agencies), is something we could not verify from official documents, so confirm it with the agency. How CFA is technically defined is worth reviewing if your team is new to the terminology.

Who receives the subsidy has implications for cash flow, documentation, and who your point of contact is at the government level.

Eligibility, Who Can Apply for Each Scheme

This is where most mistakes happen. The eligibility rules are strict, and crossing them results in application rejection, sometimes after weeks of document submission.

PM Surya Ghar eligibility (residential only):

• The applicant is a consumer with a valid consumer account number for a DISCOM connection (clause 6(b)). PIB's Mar 2024 explainer also says the applicant must own a house with a suitable roof.
• The system must be tagged to a residential power connection of the local DISCOM, on a roof, terrace, balcony or elevated structure (clause 5(b)).
• CFA is paid on up to 3 kW per household (no additional CFA beyond 3 kW). Group housing societies and RWAs get CFA for common facilities only: Rs 18,000/kW up to 500 kW at 3 kW per house, on a connection dedicated to common facilities (clauses 5(e), 5(f)).
• A rooftop system is eligible for CFA only once after installation (clause 5(o)).
• The applicant must complete self-registration on the PM Surya Ghar National Portal.
• Installation must be by a vendor registered on the National Portal, using DCR modules (clauses 7(a), 5(m)).

CFA eligibility (commercial and institutional):

• Under PM Surya Ghar, none: "No CFA will be provided to non-residential segments of consumers (including government segment, commercial and industrial segment etc.)" (clause 5(d)).
• Any other CFA-type programme has its own eligibility, set by its own guidelines and agency.
• We could not verify current capacity limits or CFA rates for any non-residential programme, so we do not print them.
• Ask the agency (SECI, the state nodal agency or the DISCOM) where applications for that programme are made.
• Ask who the subsidy is paid to and when, and get it in writing.

For detailed residential eligibility criteria, the PM Surya Ghar eligibility guide covers the disqualifying scenarios.

Subsidy Amounts, What Each Scheme Actually Pays

Under PM Surya Ghar the CFA is a fixed amount by installed module capacity. We could not verify the rates of any other current CFA programme, so the second half of this section says what to ask rather than quoting figures.

PM Surya Ghar subsidy slabs (fixed amounts per system size):

• 1 kW: ₹30,000
• 2 kW: ₹60,000
• 3 kW and above: ₹78,000 (capped, no additional subsidy for 4 kW, 5 kW, etc.)
• Special-category States and UTs (Uttarakhand, Himachal Pradesh, J&K, Ladakh, the North-Eastern states including Sikkim, A&N Islands and Lakshadweep): ₹33,000/kW for the first 2 kW and ₹19,800 for the third kW, which is ₹85,800 for 3 kW
• Group housing societies and RWAs, common facilities only: ₹18,000/kW (₹19,800 in special-category states), up to 3 kW per house and 500 kW overall

These amounts are fixed regardless of the actual installation cost. Whether your customer's 3 kW system costs ₹1.5 lakh or ₹2 lakh, the central subsidy is ₹78,000 flat. If you want to run the exact subsidy math for a given system size, the calculation guide walks through every slab and state top-up. See the PM Surya Ghar subsidy slabs breakdown for state top-up amounts that stack on top.

Other CFA-type programmes:

PM Surya Ghar's own CFA is 60% of the benchmark cost for the first 2 kW and 40% for the third kW (clause 5(e)). For any older or other programme, such as GRPV Phase II, get the current guidelines from MNRE or the agency and check three things: whether it is still open for new applications, what the rate is, and who is paid.

• Residential sector: use PM Surya Ghar. For households that already took subsidy under the earlier Phase II programme, clause 5(n) of the guidelines allows extra CFA under PM Surya Ghar only for the balance capacity up to 3 kW overall.
• Institutional / government buildings: no CFA under PM Surya Ghar (clause 5(d)). If another programme applies, the agency running it sets the rate and the rules, so get its current guidelines.
• Commercial / industrial: no CFA under PM Surya Ghar (clause 5(d)). The usual incentive is a tax benefit: depreciation on solar under s.33 of the Income-tax Act, 2025 (in force from 1 Apr 2026; formerly s.32 of the 1961 Act), at 40% WDV. This is not a grant but a tax benefit, a different mechanism entirely. Confirm the treatment with your CA.

When you quote a residential customer on these slabs, you can build the proposal in Quickest's solar quotation system, with the PM Surya Ghar subsidy applied in the proposal. Check the subsidy line against the guidelines before you share it.

Head-to-Head Comparison, The Full Decision Matrix

Application Process Differences, Portal vs Agency Route

The PM Surya Ghar flow is documented in the guidelines; we do not have an official flow for other programmes, so this section covers PM Surya Ghar only. Understanding it helps you set correct timeline expectations and avoid the common PM Surya Ghar rejection reasons that arise from routing the wrong customer through the portal.

PM Surya Ghar application flow (DISCOM-centric):

1. 1

   Consumer self-registers on pmsuryaghar.gov.in

   Using the electricity consumer account number. The portal generates an application ID, and the consumer then submits bank account details (clauses 6(b), 6(s)).

2. 2

   DISCOM issues feasibility letter

   For systems up to 10 kW, feasibility is deemed accepted once your state and DISCOM operationalise it under the Electricity (Rights of Consumers) Rules 2020 as amended; until then the consumer uploads documents for approval (clause 6(h)). Timing differs by DISCOM, so ask yours.

3. 3

   Empanelled vendor installs the system

   Only vendors registered on the National Portal qualify (clause 7(a)). Installation must use DCR modules (clause 5(m)). After installation the consumer uploads documents and geo-tagged photographs.

4. 4

   DISCOM inspection and net-meter installation

   The DISCOM physically inspects the system, signs the metering agreement, installs the net meter and approves the application on the portal (clauses 6(k), 6(l)). The CFA is processed only after this physical verification. How long this takes differs by DISCOM.

5. 5

   Subsidy DBT to consumer bank account

   After DISCOM approval, the CFA is processed within 15 days (clause 6(t)) and released through an e-token the consumer redeems on the portal. If the consumer took a loan, it is credited to the loan account. PIB's explainer of 12 Feb 2025 put the average at around 15 days after the redemption request. For regional detail, a disbursement timeline breakdown may help, but check its date.

CFA application flow (agency-centric, more complex):

For any other CFA-type programme, get the steps from the agency running it. We could not verify an official application flow, payment timeline or empanelment route for a current non-residential programme, so we do not describe one.

For the PM Surya Ghar route, the complete step-by-step is at PM Surya Ghar application process. Note that PM Surya Ghar requires DCR modules (domestically manufactured modules from domestically manufactured cells, clause 5(m)), which is a separate test from the ALMM lists. Check each programme's own rules.

The Scheme-Selector Framework, Which Subsidy to Recommend

This is the proprietary decision frame we call the Customer-to-Scheme Mapping Matrix. Use it as a qualification script at the start of every solar sales conversation.

Key Process Differences That Affect Your Cash Flow

As an EPC owner managing multiple projects, the cash-flow implications of each scheme are significant. Here's how they play out in practice.

Under PM Surya Ghar, the subsidy goes to the customer, not to you. Your vendor invoice is paid by the customer, who then waits for the government to credit their account. This means your receivable is entirely dependent on your customer's payment terms, not the government's disbursement timeline. If you've structured a full-payment-on-commissioning deal, you get paid promptly; the customer's wait for the subsidy is their problem. If you've offered "pay after subsidy" terms, you're effectively offering credit, plan working capital accordingly.

If you work under a programme that pays the subsidy to you as the developer, your receivable is a government payment with a timing you must confirm in writing. Plan working capital for the gap. EPCs who haven't sized their working capital correctly often stall here, which is one reason the guide on how much capital to start a solar business covers institutional and CFA projects separately from residential.

Pros and Cons for an EPC Choosing Which Segment to Pursue

DISCOM vs SECI, Two Very Different Government Touchpoints

Under PM Surya Ghar, your primary government interface is the DISCOM (Distribution Company). In Gujarat, that's DGVCL, MGVCL, PGVCL, or UGVCL depending on the circle. In Maharashtra, it's MSEDCL. In Karnataka, BESCOM. The DISCOM handles feasibility where required, the physical inspection, the net-meter installation, and approves the application on the portal, after which the CFA is processed.

Under any other CFA-type programme, your interface may be SECI or the State Nodal Agency, typically the State Renewable Energy Development Authority (for example GEDA in Gujarat, MEDA in Maharashtra, KREDL in Karnataka), and the DISCOM may be involved only for the net-metering connection. Confirm this for the specific programme.

This distinction matters when a deal stalls:

• PM Surya Ghar stall: usually at the DISCOM inspection or net-meter backlog. Escalation path is through the consumer portal or the MNRE grievance mechanism at pmsuryaghar.gov.in.
• Stall under another programme: ask the agency running it where escalation goes, and keep every email and acknowledgment.

The guidelines say the portal will generate triggers for delays in DISCOM inspection and net-meter installation (clause 8(a)(v)), so use the portal and its grievance route when a DISCOM step stalls.

How Quickest Solar CRM Fits Into Both Segments

Running a residential PM Surya Ghar pipeline and exploring institutional CFA projects are not mutually exclusive. Some EPCs run residential PM Surya Ghar work and institutional projects side by side. The challenge is visibility: knowing where each deal is in each process, and which field rep is following up on what.

The solar sales funnel India guide maps the full pipeline from first call to commissioning. Quickest Solar CRM sits across the entire funnel:

• Proposal Generator, builds a branded proposal PDF with your logo, items, photos and terms, with the PM Surya Ghar subsidy applied in the proposal for residential customers. Check the subsidy figure against the current guidelines before you share it. Use your own proposal templates for institutional quotes.
• Pipeline Management, use customisable lead stages and labels to track residential and institutional deals separately, log activities on each lead, and use the dashboard and team report to see which team member is following up on which customer.
• WhatsApp Follow-up, share the proposal PDF on WhatsApp and use saved message templates for follow-ups. For PM Surya Ghar pitches, include the bank's EMI summary in the same message.
• Lead Capture, add leads and tag them at intake with a label for customer type (residential vs institutional) so every rep sees it before the first call.

For EPC owners learning how to pitch the subsidy conversation, how to pitch PM Surya Ghar to customers gives a word-for-word framework for both the homeowner and the school-principal conversation.

What to Do This Week to Qualify Leads Correctly

Three actions for your EPC this week:

1. Add a "connection type" field to your lead intake form. Domestic / Commercial / Industrial / Institutional, this single field routes every lead to the correct subsidy conversation. In Quickest Solar CRM you can use a label for it so the rep sees it before calling the customer. Start with the free plan, zero card required.

2. Train your field team on the scheme-selector matrix above. Print the "Customer type → Recommended scheme" table and put it in every field kit. Your boys should be able to classify a lead in 60 seconds based on the electricity bill in front of them. Cross-reference with qualifying solar leads to add a pre-qualification call script.

3. Review your registration status for each programme separately. Your PM Surya Ghar portal registration and any agency registration for other programmes are independent. It also helps to understand the state-by-state DISCOM net metering process, since net metering sits downstream of both empanelments regardless of which subsidy route the customer takes. If you're planning to move into institutional solar in FY2026–27, ask the agencies which registrations apply and how long they take. Check the PM Surya Ghar empanelled vendor guide for the residential side, and contact your State Nodal Agency for the CFA-side process.

Frequently Asked Questions

What is the difference between PM Surya Ghar and CFA scheme?

PM Surya Ghar Muft Bijli Yojana is the central residential rooftop scheme. Its subsidy is called CFA (Central Financial Assistance): ₹30,000/kW for the first 2 kW and ₹18,000 for the third kW, capped at ₹78,000 (₹85,800 in special-category states), paid to the consumer. Societies and RWAs get ₹18,000/kW for common facilities up to 500 kW. "CFA scheme" in casual use can also mean older or other programmes such as GRPV Phase II, which have their own rules; we could not verify their current status, so confirm with the agency. Commercial and industrial connections get no CFA under PM Surya Ghar (clause 5(d)).

Can a shopkeeper or factory owner apply for PM Surya Ghar?

No. The MNRE guidelines say no CFA is provided to non-residential segments, including government, commercial and industrial (clause 5(d)). Their usual incentive is a tax benefit: depreciation on solar under s.33 of the Income-tax Act, 2025 (formerly s.32 of the 1961 Act), at 40% WDV. Ask the CA how much it is worth for the customer.

How fast is PM Surya Ghar CFA paid?

Under PM Surya Ghar the CFA is processed within 15 days of DISCOM approval (clause 6(t)), and PIB's explainer of 12 Feb 2025 put the average at around 15 days after the consumer's redemption request. The DISCOM inspection step before approval varies by DISCOM. We could not verify the payment timeline of any other CFA programme, so ask the agency and get it in writing.

Do both PM Surya Ghar and CFA require ALMM-listed or DCR modules?

PM Surya Ghar requires DCR modules: domestically manufactured modules made from domestically manufactured cells, and use of non-DCR modules in any form makes the installation ineligible for CFA (clause 5(m)). That is separate from the ALMM lists, which MNRE maintains for modules and, from 1 Jun 2026, cells. For any other programme, check its own guidelines.

Can an EPC be registered for both PM Surya Ghar and other CFA programmes at the same time?

PM Surya Ghar needs registration on the National Portal (clause 7(a)). Whether any other programme needs a separate registration is set by that programme, so ask the agency running it. Registrations for different programmes are independent of each other.

What happens if my customer has a domestic connection but wants a system above 3 kW?

CFA is capped at the 3 kW slab (₹78,000) regardless of system size: a 5 kW or 10 kW residential system gets the same ₹78,000, because CFA is on the rated module capacity up to 3 kW and the guidelines give no additional CFA beyond it (clauses 5(e), 5(k)). The guidelines do not set a 10 kW size cap for installation, though banks may. For state top-ups on larger systems, check your state's order.

Is PM KUSUM the same as CFA?

No, and if your team also fields agricultural leads, a full PM Surya Ghar vs KUSUM comparison is worth bookmarking alongside this one. PM KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) is a separate scheme for solar pumps and feeders in the agricultural sector, with its own guidelines and an application route through state agencies. Check the current MNRE guidelines for the subsidy shares.

Where do I apply for CFA for my school project?

Under PM Surya Ghar a school gets no CFA (clause 5(d)). If another programme is open, the state nodal agency for renewable energy in your state (for example GEDA in Gujarat, MEDA in Maharashtra or KREDL in Karnataka) or SECI is the place to ask which one and how to apply. We could not verify an open non-residential CFA programme, so confirm before you promise one.