Modeling the Constraints to Low-Carbon Energy Technology Adoption in Indian SMEs: An ISM–MICMAC Structural Analysis

India needs to adapt low-carbon energy technologies to meet climate targets and reduce dependence on fossil fuels. However, adoption remains limited among small and medium-sized enterprises (SMEs) due to due to multiple interrelated barriers. The study investigates the structural relationships of major barriers to the adoption of low carbon energy technology in Indian SMEs. A literature review was performed and the outcomes of this review were validated by experts’ comments to identify fourteen barriers. An interpretive structural modelling (ISM) approach was employed for the development of a hierarchical framework. Also, Cross-Impact Matrix Multiplication Applied to Classification (MICMAC) analysis was used to classify the barriers based on their driving and dependent power. The findings suggest the presence of a multi-layered system marked by high initial capital costs, limited institutional readiness, and a shortage of skilled labour. A number of policy and financial concerns such as regulatory uncertainty, lack of incentives and limited access to funding are examples of linking factors that show high interaction effects. Meanwhile, technological constraints such as integration problems and unpredictability in performance are mostly driven by upstream structural limits and arise from these underlying constraints. The study provides system-level insights to foster industrial decarbonization in emerging economies and underscores the need for coordinated interventions to accelerate the adoption of low-carbon technologies in SMEs. Such interventions can be made through financial support, institutional capacity strengthening and the building of robust policy frameworks.