- Indian Cabinet has given its seal of approval to the government’s flagship rooftop solar scheme
- It will target to achieve 30 GW installed PV capacity with a total outlay of INR 750 billion
- Households will get up to 300 units of free electricity/month with their rooftop solar systems and earn extra income by selling surplus to discoms
The Union Cabinet of India has officially approved the recently announced PM-Surya Ghar: Muft Bijli Yojana through which the government expects to achieve 30 GW installed rooftop solar capacity. The scheme has a total outlay of INR 750 billion ($9 billion).
Loosely translated from local Hindi language as Prime Minister Solar Home: Free Electricity Scheme, the program was announced recently by Indian Prime Minister Narendra Modi (see India Solar PV News Snippets).
It promises to provide up to 300 units of free electricity/month to 10 million households. A 3 kW system can generate over 300 units of power/month on an average for a household.
Under the scheme, the government will offer central financial assistance (CFA) of 60% system cost for 2 kW systems and 40% of additional system cost for systems between 2 kW and 3 kW capacity. The CFA will be capped at 3 kW.
According to the government estimates, this translates into INR 30,000 ($362) subsidy for 1 kW, INR 60,000 ($724) for 2 kW, and INR 78,000 ($941) for systems of 3 kW and higher capacity.
Interested households can apply for this assistance through the national portal https://pmsuryaghar.gov.in to select appropriate system sizes and select vendors.
Households will be able to access collateral-free low-interest loan products of around 7% at present for installation of residential rooftop solar systems of up to 3 kW.
Along with getting 300 units free electricity, households will also be able to earn additional income by selling surplus power to discoms.
The government expects the scheme to generate around 1.7 million direct jobs across manufacturing, logistics, supply chain, sales, installation, O&M and other services.
To spread awareness about the scheme in rural areas, the government will develop a model solar village in each district of the country and engage urban local bodies and Panchayati Raj institutions.
It also provides a component for payment security for renewable energy service company (RECO) based models as well as a fund for innovative projects in rooftop solar.
A laggard so far compared to utility-scale solar, rooftop solar segment in India should get the much-needed boost with this scheme. While utility-scale solar installed capacity totaled 57.82 GW at the end of January 31, 2024, grid-connected rooftop PV stood at 11.08 GW, according to the Ministry of New and Renewable Energy (MNRE).
