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Centre to provide Rs. 5000 Crore Subsidy for Rooftop Solar Power
Feb 01, 2016

India has earmarked Rs. 5,000 crore rupees to pay for the installation of rooftop solar panels over the next five years that will generate up to 4200 megawatts of power.

  • The Union Government increased the funding from an earlier Rs.600 Crore to Rs. 5000 Crore. In a bid to increase the use of clean energy, the Centre decided to scale up by nearly 10-fold the financial assistance for grid connected rooftop and small solar power plants.

  • The government has set a target of generating 100,000 MW of electricity from solar panels by 2022 to overcome an acute power shortage.

  • This budget will be for implementation of Grid Connected Rooftops systems over a period of five years upto 2019-20 under National Solar Mission (NSM).

  • This will support installation of 4200 Mw Solar Rooftop systems in the country in the next five years.

  • The capital subsidy of 30 per cent will be provided for general category States/UTs and 70 per cent for special category States including North-Eastern States including Sikkim, Uttarakhand, Himachal Pradesh, Jammu & Kashmir and Lakshadweep, Andaman & Nicobar Islands.

  • There will be no subsidy for commercial and industrial establishments in the private sector since they are eligible for other benefits such as accelerated depreciation, custom duty concessions, excise duty exemptions and tax holiday.

  • This capacity of 4200 Mw will come up through the residential, government, social and institutional sectors like hospitals and educational institutions.

  • The industrial and commercial sector will be encouraged for installations without subsidy. 

  • This will create the market, build the confidence of the consumers and will enable the balance capacity through market mode to achieve the target of 40,000 MW by 2022.

  • The Government has revised the target of National Solar Mission (NSM) from 20,000 Mw to 1,00,000 MW by 2022. Of that, 40,000 Mw is to come through grid connected solar rooftop systems. 

  • Solar power generated by each individual household, industrial, institutional, commercial or any other type of buildings can be used to partly fulfil the requirement of the building occupants and surplus, if any, can be fed into the grid.

  • So far, 26 States have notified their regulations to provide Net Metering/Gross metering facilities to support solar rooftops installations.

This 40 Gw will result in abatement of about 60 million tonnes of CO2 per year and will help to fulfil the commitment of India towards its contribution in mitigating the effect of climate change.


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