Govt bets big on solar parks, rooftop installations

Nearly a year after the Narendra Modi government increased the solar power target five-fold to 100 gigawatt (GW) by 2022, the ministry of new and renewable energy (MNRE) has finalised a scheme for achieving the target through rooftop installations and solar parks housing large solar units.

The solar power development plan, readied by MNRE, has two components — rooftop equipment installations and setting up ground-mounted units in solar parks. While the former is expected to yield 40 GW of power, the latter would produce 20 GW. Both these categories will receive central government support in the form of grants. Another 40 GW is expected to come from ground-mounted units outside the designated solar parks, without central aid.

On the rooftop solar front, the ministry has provided states with the annual targets for each year up to 2022. “The state-wise tentative target has been arrived at by dividing 40 GW country target in proportion of the state-wise power consumption and consequent solar power requirement to meet the corresponding renewable purchase obligation (RPO),” the ministry said.

Among the states, Maharashtra and Uttar Pradesh have the largest targets of achieving 4.7 GW and 4.3 GW, respectively, by 2022. Other major contributions is expected from Tamil Nadu (3.5 GW), Gujarat (3.2 GW) and Karnataka (2.3 GW).

The states could avail of financial help of up to 60% of project cost as grant under the integrated power development scheme (IPDS) and 15% of additional grants on achieving milestones defined under the scheme. Under IPDS, which aims at upgrading of transmission and distribution systems also, Rs 25,354 crore over the entire implementation period has been approved by the central government. States have the option of using up to  10% IPDS grant for solar rooftop units.

Additionally, exclusive capital subsidy of Rs 15,050 crore would be made available to promote solar capacity addition by way of rooftop units. The subsidy, approved by the Union Cabinet recently, is in the form of viability gap funding (VGF) and the projects would be developed through the Solar Energy Corporation of India (SECI). “The amount that the government has sanctioned may not get spent due to the lack of demand and the question remains whether 15% of subsidy would be attractive enough,” Jasmeet Khurana,marketing intelligence, Bridge to India, a solar consultancy company said.

As for mega solar parks, the ministry has rolled out a scheme for setting up 25 such parks, each with a capacity of 500 MW or above, thereby targeting around 20 GW of solar power installed capacity. So far, the central government has got the consent of 19 states for large solar power parks with a total of 13 GW of capacity.

Eye on target
* 40 GW of rooftop solar units and 20 GW of solar parks envisaged to come up by 2022
* States allotted tentative capacity on an annual basis
* States could collectively receive grants to the tune of Rs 15,050 crore from Centre via viability gap funding and Rs 2,400 crore via IPDS
* States to receive another Rs 4,000 crore in grants for solar parks
* State-nominated agency to be in charge of infrastructure creation inside solar parks
* PGCIL to help agency to lay intra-state and inter-state transmission lines

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