Solar Panel Prices Drop 25% Following Government Policies, Raising Industry Concerns

\In a recent development that has made solar energy more accessible to numerous households in Hyderabad, the cost of solar panels has experienced a substantial reduction. A 585-watt A-grade solar panel, once priced at Rs. 22,000, is now available for Rs. 16,500, making it easier for lower- and middle-income families to invest in solar energy solutions.

This price reduction follows a controversial decision by the government to lower the buyback rate for solar net metering from Rs. 27 per unit to Rs. 10 per unit. The change is part of a set of amendments approved by the Economic Coordination Committee (ECC), aimed at addressing rising electricity costs for grid consumers.

While the reduction in solar panel prices is seen as a positive shift for consumers looking to transition to solar energy, it has raised concerns within the solar industry. Industry leaders argue that these new policies could harm the growth of the sector and reduce long-term investments in solar power.

The total installed capacity grew from 321 MW in 2021 to 4,124 MW by December 2024, demonstrating a rapid expansion in the adoption of solar energy. However, critics argue that the new buyback rate will impose a significant financial burden on the solar sector, slowing its growth.

Despite these concerns, the reduction in solar panel prices has created an opportunity for households to shift to solar energy and reduce their dependency on the national power grid. With solar power becoming more affordable, many residents are now opting for small-scale solar installations to power essential appliances like lights, fans, and refrigerators, especially during the scorching summer months.

The local solar market is also seeing increased demand, as many shopkeepers have reported a noticeable uptick in sales. Speaking with TechJuice, a shopkeeper in the region shared, “We’ve seen more customers coming in for solar panels since the price drop. Many are opting for smaller setups to save on electricity bills and avoid power cuts. The affordability has definitely made solar energy a more viable option for people in Hyderabad.” This shift towards solar energy is helping reduce pressure on the already overstretched national power grid.

However, as more people make the switch to solar power, experts warn that the government’s policies may need further refinement. The government’s attempt to control rising grid electricity costs through regulatory changes may have unintended consequences, particularly for the long-term sustainability of the solar sector.