MNRE Revises Financial Assistance Benchmark For Rooftop Solar

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The modifications supersede the directives given in the ministry’s earlier memorandum and are effective immediately from the date of issuance of the new office memorandum.

The Ministry of New and Renewable Energy in India has recently approved revised benchmarks for Central Financial Assistance (CFA) under Phase-II of the Rooftop Solar Programme. This decision, documented in the official memorandum dated 27.01.2023, is aimed at boosting support for grid connected rooftop solar photovoltaic systems.

The revised CFA structure is designed to cater to different project capacities and categories, offering tailored rates for different segments. The revised CFAs will apply to all new bids and those tenders that are scheduled to close 15 days after the issuance of the revised rates.

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For individual household projects, the CFA rates have been set at Rs 18,000/kW for capacities ranging from 1-3 kW in general states, and Rs 20,000/kW for the same capacity in special category states. For larger projects with capacities above 3-10 kW, the revised rates are Rs 9,000/kW for general category states and Rs 10,000/kW for special category states.

Resident Welfare Associations/Group Housing Societies (RWA/GHS) and common facilities of up to 500 kW capacity will also benefit from the revised CFA, which is set at Rs 9,000/kW for general category and Rs 10,000/kW for special category states. This change in CFA rates is intended to streamline the provision of financial assistance based on the characteristics of each project, thereby promoting equitable support and distribution of renewable energy initiatives across the country.

Implementing agencies, which include DISCOMs and State Implementing Agencies (SIAs), are required to conduct a tendering process for rate discovery and vendor empanelment, in line with the scheme guidelines issued on 20.08.2019. In tender mode, the admissible CFA will be the lower of the revised benchmark CFA or the discovered rate. For capacities of 1-3 kW, the CFA is capped at 40%, and for capacities above 3-10 kW, it is capped at 20%.

These modifications supersede the directives given in the ministry’s earlier memorandum and are effective immediately from the date of issuance of the new office memorandum. This development is a significant step in encouraging the adoption of rooftop solar projects across India, especially in special category states. By adjusting the financial support mechanisms, the Ministry aims to foster sustainable energy practices and contribute to India’s green energy objectives.

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