Solar Capacity Addition Awaits North Block's Push to Power Rs 8 L crore Investment Potential

Published: 26th March 2015 06:00 AM  |   Last Updated: 26th March 2015 03:38 AM   |  A+A-

NEW DELHI: The government’s ambitious plan of raising solar power generation capacity to 100,000 MW by 2022 is likely to face major roadblocks.

According to Finance Ministry sources, it is yet to accept the Renewable Energy Ministry’s proposal for growth in solar generation capacity. Sources said that without incentives, getting investments to the tune of Rs 7-8 lakh crore in the sector would be impossible.

Solar Capacity.jpgSources also said that the North Block is yet to accept renewable ministry’s proposal for extending wide-ranging support to solar power projects, including increasing viability gap funding (VGF), interest subvention scheme, easier terms for long tenor loans and subsidy for roof-top and small solar power projects to be developed by village panchayats and unemployed youths.

The annual targets could also be revised depending on what comes its way from the finance ministry.

“Without financial support and incentives it would be difficult to rope in investors to make commitments to the extent required for achieving the solar generation targets,” the official said.   

Presenting his Budget proposals finance minister Arun Jaitley did acknowledge the increased generation target for the solar sector.

  In the 2015-16 Budget, allocation for the ministry of new and renewable energy is mere Rs 2,700 crore and a major portion of this fund (about Rs 2,400 crore) is coming from the National Clean Energy Fund.

The ministry had sought a higher budgetary allocation under a three-year plan (2015-2018) of Rs 35,580 crore. Of this, Rs 5,000 crore was proposed for VGF support for large-scale projects to be set up Solar Power Corporation of India (SECI), Rs 15,580 crore for subsidy for rooftop solar projects and Rs 15,000 crore subsidy for 0.5 to 5 MW solar projects to be set up by village panchayats and unemployed youths.

Out of the 100,000 MW target, 60,000 MW is targeted to come from large grid connected solar projects and 40,000 MW from rooftop solar.

In addition, the plan to raise solar capacity to 20,000 MW by 2022 through the National Solar Mission would run separately.

Out of the country’s total installed capacity of 2,58,000 MW, the installed solar capacity in the country is only about 3,000 MW.

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