The Indian government is all set to raise the subsidy for rooftop solar installations to 60%. This hiked subsidy will apply to all projects implemented under the newly launched Pradhan Mantri Suryoday Yojana. The subsidy for consumers in hilly/ north-eastern states and union territories will be 70%.
The current solar subsidy for all consumers is 40% of the project cost.
The announcement was made by the Union Minister of New and Renewable Energy, R.K Singh. The minister also clarified that the Suryoday scheme launched by PM Narendra Modi will only focus on those households that have a monthly consumption of less than 300 units. These are generally the weaker sections of the society.
He further explains that the remaining 40% of the project cost will be covered by a loan with a tenure of up to 10 years. This loan will be taken through a Special Purpose Vehicle (SPV) set up by a central public sector enterprise, rather than the individual.
Moreover, the excess units generated by the solar plants will be used to pay off the loan. After the loan-repayment period, the ownership of the solar plant will get transferred to the households, who can then sell the surplus energy directly to the DISCOMs.
“Householders have to do nothing and will get the benefit of free 300 units per month. After 10 years, the benefit of excess units will also go to the householder. The SPV will repay the loan and CPSU will exit by handing over the system to the householder,” Singh said.
Finance Minister Nirmala Sitharaman in her Interim budget 2024 speech explained that beneficiaries of this new solar scheme can earn up anywhere between ₹15,000 and ₹18,000 annually through energy savings and the sale of power.
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Resource: ET Energy
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