Indian Cabinet approves ₹11,814 crore for Rooftop Solar Program

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The Cabinet Committee on Economic Affairs (CCEA) headed by Prime Minister Narendra Modi has approved a total funding of ₹11,814 crore for the second phase (Phase II) of the Rooftop Solar Program. The funding will be available as the Central Financial Support.

The Government aims to install a total solar rooftop capacity of 40 GW by 2022.

Solar Subsidy

The subsidy on solar plants has now been increased from 30% to 40%. The new subsidy structure is mentioned in the below table.

Solar Plant Size Subsidy
Up to 3 kW (Residential) 40%
4 kW to 10 kW (Residential) 20%
10 kW to 500 kW (Group Housing Societies /
Resident Welfare Associations)
20%

Subsidy is available on the benchmark cost or the project cost whichever is lower.

DISCOM Incentives

In addition to providing subsidies, the committee has decided to provide incentives to the Distribution Companies (DISCOMs), further accelerating the ambitious Rooftop Solar Program. These incentives are based on the performance of DISCOM in capacity generation. This will enable them to create an ecosystem to promote rooftop solar. The incentive to DISCOMs is as follows:

Parameter Incentive
If Installed Capacity in one financial year is up to 10%of the total rooftop solar capacity till the end of previous year for DISCOM No Incentive
If Installed capacity in one financial year between 10% to 15% of the total rooftop solar capacity till the end of previous year for DISCOM 5% of the project / benchmark cost for capacity achieved above 10% of the installed base capacity
Installed capacity in one financial year above 15% of the total rooftop solar capacity till the end of previous year for DISCOM 5% of the project / benchmark cost for capacity between 10% to 15% of the installed base capacity      + 10% of the project / benchmark cost for capacity achieved above 15% of the installed base capacity

Environmental Benefits

The Program will have a huge positive impact on our environment. It will help in saving a lot of carbon dioxide emissions into the atmosphere. Thus, saving us from global warming and climate change. It is expected that addition of 38 GW solar rooftop plants under Phase-II by year 2022 will result in CO2 emission reduction of about 45.6 tonnes per year.

Employment

The Program will provide employment opportunity to millions in the country. It has a potential to generate employment opportunity equivalent to 9.39 lakh jobs for both skilled and unskilled workers by the year 2022.

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