India’s solar subsidy scheme aims to make solar energy more affordable and accessible, promoting widespread adoption of solar power. Here are some key aspects of the scheme:
Central Government Initiatives
PM-KUSUM Scheme:
- The Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme provides subsidies for installing solar pumps and grid-connected solar power plants. The scheme has three components:
- Component A: 10,000 MW of decentralized ground-mounted grid-connected renewable power plants are installed.
- Component B: Installation of 20 lakh standalone solar-powered agriculture pumps.
- Component C: Solarization of 15 lakh grid-connected solar-powered agriculture pumps.
Rooftop Solar Program Phase II:
- This scheme provides financial assistance to residential consumers installing rooftop solar systems. The subsidy structure is as follows:
- Up to 3 kW: 40% subsidy
- 3 kW to 10 kW: 20% subsidy (only for the portion above 3 kW)
- Above 10 kW: No subsidy for the capacity above 10 kW.
Solar Parks and Ultra Mega Solar Power Projects:
The government provides financial support for creating solar parks with a minimum capacity of 500 MW each. These parks facilitate large-scale solar project installations by providing land, infrastructure, and other necessary facilities.
PM Surya Ghar: Muft Bijli Yojana
In the Budget 2024-25, the Finance Minister announced a new rooftop solar scheme, subsequently launched by the Prime Minister on 15 February 2024. The ‘PM Surya Ghar Muft Bijli Yojana’ aims to install solar panels in houses to supply power to households and generate additional income from excess electricity output.
Subsidies and Financial Support:
The Central Government will provide substantial subsidies directly to people’s bank accounts and heavily concessional bank loans to ensure there is no cost burden on the people. The government subsidy will cover up to 40% of the cost of the installation of the solar panels.
Economic Impact:
This scheme will help poor and middle-class households save up to Rs. 15,000 to Rs. 18,000 crores annually by getting free solar electricity and selling surplus power to electricity distribution companies. The government aims to install solar panels in one crore homes throughout the country, helping save around Rs. 75,000 crore per year in electricity costs.
Objectives:
The PM Surya Ghar Muft Bijli Yojana aims to provide 300 units of free electricity annually to light up one crore households. The aim is to reduce electricity costs by installing rooftop solar panels and using solar energy, decreasing dependency on traditional energy sources, and promoting sustainable energy practices.
State Government Initiatives
State-specific Subsidies and Incentives:
- Various states in India offer their subsidies and incentives to promote solar power. For example:
- Gujarat: Offers additional subsidies on top of central subsidies for residential solar installations.
- Maharashtra: Provides a capital subsidy for solar water pumps in agriculture.
- Karnataka: Offers incentives for rooftop solar systems and solar water heating systems.
Net Metering Policies:
Most states have implemented net metering policies, allowing consumers to sell excess solar power back to the grid. This helps reduce electricity bills and provides a financial return on investment in solar installations.
Financial Support and Loans
Subsidized Loans:
Various public and private sector banks offer subsidized interest rates for installing solar systems. The Indian Renewable Energy Development Agency (IREDA) and the State Bank of India (SBI) provide such loans.
Tax Benefits:
Solar power installations are eligible for accelerated depreciation benefits, allowing businesses to depreciate their solar assets at a higher rate, reducing taxable income.
Implementation Challenges
Awareness and Accessibility:
Despite the availability of subsidies, awareness among consumers, especially in rural areas, remains a challenge. Applying for and receiving subsidies can also be bureaucratic and time-consuming.
Infrastructure and Maintenance:
Ensuring proper infrastructure and maintenance for solar installations is crucial. There have been instances where a lack of adequate maintenance has affected the performance of solar systems.
Conclusion:
In conclusion, while India’s solar subsidy schemes have been instrumental in promoting solar power, continuous efforts are needed to streamline the application process, increase awareness, and ensure proper infrastructure and maintenance to maximize the benefits.
