Solar Energy in Tamil Nadu: Subsidy and Potential for Businesses (2023)

Tamil Nadu is the fourth-largest & the sunniest state of India. The state is rich in renewable energy resources such as solar energy, wind power, hydropower, biomass, biogas, etc. Harnessing the same, the Tamil government has achieved a RE capacity of 19.6 GW.

Kamuthi solar power plant, Tamil Nadu

In terms of solar power, Tamil Nadu occupies the 4th position in India. Through policy initiatives, the state was able to increase its solar capacity from 2,575 MW in 2019 to 6233 MW in 2022.

In 2019, the state government released a solar energy policy with a target of achieving 9000 MW solar capacity by 2023. Making solar energy available, accessible, and affordable for all consumers was defined as one of the chief objectives in the document.

For 2030, Tamil Nadu Generation and Distribution Corporation (Tangedco) plans to build a solar capacity of 20000 MW at an investment of Rs 70,000 crore. As part of this goal, Tangedco floated tenders for the first-ever district-level solar park in the state. The state-owned utility company plans to establish such facilities in all districts and has identified a land area of 6,333 acres for the project.

Moreover, the state government is also striving to promote investments in solar manufacturing. In July last year, Tata Power signed an agreement with the state government, stating their intention to invest 3000 crores to set up a manufacturing unit in Tamil Nadu.

Residential solar consumers in Tamil Nadu with on-grid rooftop solar installation can avail the Central Financial Assistance. The details of the subsidy are as follows:

The key commercial segments of Tamil Nadu are textiles, heavy commercial vehicles, automobile and auto components, engineering, IT, cement, banking, financial services, drugs and pharmaceuticals, agro and food processing, leather tanning industries, electronic hardware, and tourism.

These are energy-intensive sectors which means this state has lots of potential for solar developers. Let’s analyze the three major segments of the state along with their energy consumption.

The energy consumption of this segment is less in comparison to the other two segments. Up to 30kW solar solution is enough for Residential & Agricultural.

The energy consumption of this segment is more than Residential & Agricultural and can reach up to 2 MW. A 200kW solar solution is an average capacity for this segment.

The energy consumption of these industries is very big, so these industries need 200 kW & more capacity of solar solutions.

Now you can discover which category you fit into and pick where you want to start your solar business.