Evaluation of distributed solar finance programme in India

US–India Clean Energy Finance Initiative aims to mobilise small- and mid-scale distributed solar energy projects via grant-funded technical assistance. We did an evaluation study for the initiative.

The US–India Clean Energy Finance Initiative (USICEF), a partnership between Government of India's Ministry of New and Renewable Energy (MNRE), the Overseas Private Investment Corporation (OPIC), and a consortium of foundations and investors, was launched in 2017 to increase clean energy access in India by catalysing investment in distributed renewable energy projects, particularly solar rooftop, and off-grid. The 5-year initiative was managed by Climate Policy Initiative (CPI), a finance and policy advisory organisation.

As India's first project preparation and pipeline development facility, USICEF undertook a market-driven approach to catalyse funds into a range of distributed solar project business models. USICEF provided 47 grants to 39 early-stage organisations with projects across 20 states in India. Project developers, financial intermediaries that finance developers in the off-grid and rooftop sectors were eligible to apply for project preparation support from USICEF. CPI empanelled service providers (ESPs) to provide the necessary project preparation support to these project developers.

We led interactions with selected project developers, ESPs, lenders, end-users to report direct and indirect benefits of USICEF. The evaluation report sheds light on debt funds mobilised and benefits of adopting solar for the commercial sector including a reduction in operation costs, emission saving, and developing into green businesses.


To meet its sustainable energy targets, India will require an annual decentralised renewable energy (DRE) investment of US$18 billion by 2024.

USICEF was aligned with several of the most critical constraints the early-stage solar project developers face while growing their businesses. Early-stage enterprises lack the in-house capacity and financial resources to prepare detailed progress reports, follow lender services, and negotiate effectively with lenders.

Grant-funded technical aid under USICEF focused on improving the chances of receiving long-term debt financing through easy access to experienced technical and legal advisory companies. USICEF supported its beneficiaries through financial advisory services such as business plans for investors' outreach and engagement. Collaborating with USICEF upheld the status of several small and medium solar entrepreneurs as credible investees in the impact assessment market and established working relationships with the service providers.

After the execution of the first phase of USICEF, we undertook the learning assignment for two reasons:

  • To understand the impact of the programme backed by evidence collected from the ecosystem stakeholders
  • To provide feedback on the learning generated through this process to inform future programme design, as well as implementation

Our approach

We gathered evidence from various stakeholders on programme-level impact. In consultation with CPI, the team co-developed the evaluation questions for key informants and in-depth interviews. The evaluation questions included several qualitative learning questions that go beyond the monitoring progress to understand why and how change has happened and the implications of this for future investments. We used a mixed methods approach i.e., using both quantitative and qualitative research methods to allow us to evaluate USICEF’s impact more rigorously and effectively.

Quantitative data in the form of project and programme-level reports, key performance indicators, debt mobilisation reports, capacity deployed/under deployment status, carbon dioxide abated, green jobs created, and other development parameters were collected from CPI project delivery team.

Programme and project-level literature were reviewed to help deepen our understanding of USICEF activities. Primary qualitative data was collected from selected ESPs and lenders through an online survey. The survey covered broad themes: feedback on programme structure, feedback on potential improvements to programme structure, and perceived impact of programme.

Key informant interviews of five beneficiaries fed into as many ‘Stories of Change’. This included site visits, in-depth interviews with beneficiary staff members and last mile users (rural households/MSMEs )


The USICEF project evaluation report presents the lessons learned from the programme, backed by evidence and feedback collected from the ecosystem stakeholders to inform future design. 'Stories of Change' depict the programme's impact on the end beneficiaries, including small and medium-sized enterprises and rural households.

USICEF has contributed to developing the DRE sector in India via supporting a wide range of project developers and solution providers with diversified business models in the DRE sector. USICEF mobilised 30x funds in commercial debt over the initial grants provided. The amount of funding mobilised (US$303.83 million) and the volume of renewable energy capacity installed (365 MW) and under pipeline (305 MW) achieved its stated objectives.

USICEF's grants have also resulted in a range of socioeconomic benefits. Beneficiaries estimated that up to 20,600 new green jobs have been created as an indirect benefit of the support provided. Electricity generated from solar panels is also clean and emission-free. An estimated 960,000 megatonnes of CO2 emissions might be avoided every year by the cumulative capacity expected to be installed by the beneficiaries. The benefits of USICEF to the grantees are expected to be sustained, particularly for those that have become mature market players because of the capacity support and funding mobilised.

Areas of expertise