Government incentives and support for Solar Energy generation and usage

New Delhi : For promoting solar energy in the residential sector, the Ministry of New and Renewable Energy is implementing Rooftop Solar Programme Phase-II. Under this Programme 4000 MW rooftop solar (RTS) capacity addition is targeted in residential sector through Central Financial Assistance (CFA).

CFA up to 40% of the benchmark cost is provided for RTS projects upto 3 kW capacity and up to 20% for RTS system capacity beyond 3 kW and up to 10 kW for individual households. For Group Housing Societies/Residential Welfare Associations (GHS/RWA), CFA is limited to 20% for RTS plants for supply of power to common facilities maximum 500 kW capacity.

In addition, Government has taken several steps to promote solar energy in the country. These include:

      • permitting Foreign Direct Investment (FDI) up to 100 percent under the automatic route,
      • waiver of Inter State Transmission System (ISTS) charges for inter-state sale of solar and wind power for projects to be commissioned by 30th June 2025,
      • declaration of trajectory for Renewable Purchase Obligation (RPO) up to the year 2022,
      • setting up of Ultra Mega Renewable Energy Parks to provide land and transmission to RE developers on a plug and play basis,
      • schemes such as Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM- KUSUM), 12000 MW CPSU Scheme Phase II, etc.,
      • laying of new transmission lines and creating new sub-station capacity under the Green Energy Corridor Scheme for evacuation of renewable power,
      • notification of standards for deployment of solar photovoltaic system/devices,
      • setting up of Project Development Cell for attracting and facilitating investments,
      • Standard Bidding Guidelines for tariff based competitive bidding for procurement of Power from Grid Connected Solar PV and Wind Projects.
      • Government has issued orders that power shall be dispatched against Letter of Credit (LC) or advance payment to ensure timely payment by distribution licensees to RE generators.
      • Conducting skill development programmes to create a pool of skilled manpower for setting up, operation and maintenance of RE projects.


This information was given by  R.K Singh, Union Minister for Power and New and Renewable Energy in a written reply in Rajya Sabha today.

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