MNRE had proposed using locally manufactured solar products to set up 12 GW of solar power capacity through CPSUs as part of its plan to encourage the domestic manufacturing industry in December 2017. Now the cabinet has approved the proposal. Pictured is MNRE head RK Singh (in the middle). (Photo Credit: Press Information Bureau)
- The Indian government has approved Central Public Sector Undertaking (CPSU) Phase 2 Scheme under which central government entities will set up 12 GW or more of grid connected solar power capacity
- It will be used for self-consumption of these entities or use by government or government entities at central and state level
- INR 85.8 billion ($1.2 billion) is approved as VGF support for setting up the projects
- Locally manufactured solar cells and modules will be used for this capacity to come up
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Aiming to speed up the country’s PV installation drive to achieve its 100 GW target by 2022 as envisioned by the nation and support local solar products manufacturing industry, India has asked its Central Public Sector Undertakings (CPSU) to set up 12 GW of grid connected solar power projects by March 2023. The scheme will mandate the use of domestically manufactured solar cells and modules.
Approving this proposal of the Ministry of New and Renewable Energy (MNRE), the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi has given green light to the CPSU Phase II scheme with viability gap funding (VGF) of INR 85.8 billion ($1.2 billion) (see India: $1.71 bn Local PV Manufacturing Plan).
“The Scheme will also help in giving a push to ‘Make-in-lndia’ by encouraging Government Producers to procure solar cells and modules from domestic manufacturers. The Scheme will create sufficient demand for domestically produced solar PV cells and modules for the next 3 to 4 years,” read the official release from the Government of India.
The CPSUs and governments or government entities at central and state levels will use this capacity for self-consumption. The timeline of setting up this 12 GW or more grid connected PV capacity is 4 years, between FY 2019-20 and 2022-23. It is said to create investment of about INR 480 billion ($6.71 billion).
The government expects this scheme to generate employment opportunities for around 60,000 people for about a year in pre-construction activities and around 18,000 for about 25 years in the operation and maintenance period. In the supply chain including manufacturing, over 1,20,000 additional jobs are envisioned to be created.
At the end of 2018, India installed 25.21 GW of grid-connected solar power capacity (see India: 25 GW Total PV Capacity End Of 2018).