India has reduced the Goods and Services Tax (GST) on renewable energy devices from 12% to 5%, effective 22 September 2025. The reform, cleared at the 56th GST Council meeting, is set to lower solar project costs and ease electricity procurement expenses for distribution companies. Utility-scale solar plants may save about INR 20–25 lakh (~ $24,000–30,000) per MW, with a 500 MW project achieving cost reductions exceeding INR 100 crore (~ $120 million). Rooftop solar systems are expected to become cheaper by INR 9,000–10,500 (~ $108–~ $ 130) for every 3kW unit installed, while farmers using the PM-KUSUM scheme could collectively save INR 1,750 crore (~ $2.1 billion) on 10 lakh solar pumps. The reduced tax rate is also likely to bring down module and component costs by 3–4%, encouraging domestic equipment production and supporting employment growth. The measure is anticipated to ease financial burdens across households, farmers, and developers while improving competitiveness in India’s renewable energy sector.