New Delhi

The government will bear the entire cost of installing solar rooftop systems as part of the Pradhanmantri Suryodaya Yojana, which will offer up to 300 kilowatts of power monthly to one crore low income households.

A low income household is being identified as one whose monthly electricity consumption is below or up to 300 kilowatts or unit.

Power and New & Renewable Energy Minister R K Singh in a media interaction on Friday said Centre will bear the entire cost of installing rooftop solar (RTS) systems.

“We are presently working on the scheme. This 300 units is consumed by largely lower middle class. For them, taking a loan is a problem. We intend to increase the subsidy on RTS. Right now subsidy (under roof top solar programme) is 40 per cent. For this scheme we want to increase it probably to about 60 per cent. The remaining 40 per cent will be a loan, but it will be taken by Power sector CPSE. For special category states the subsidy will be 70 per cent,” Singh added.

The Council on Energy, Environment and Water (CEEW) Senior Programme Lead Neeraj Kuldeep said that analysis suggests 20-25 gigawatts (GW) of RTS capacity would be supported.

CRISIL Market Intelligence & Analytics Director-Research Miren Lodha said it can support capacity additions of 20-22 GW, which could spawn investments of ₹91,000-110,000 crore.

Scheme dynamics

Elaborating on the process, the Minister said that the government envisages that central public sector enterprises (CPSEs) will set up special purpose vehicles (SPVs), which will take loans and set up the RTS units.

“The householder does not have to go anywhere. The excess units that are generated will be used to pay for the loan. We calculate that the loan will be paid in 10 odd years,” he added.

The poor households normally consume about 120-130 units. The government is targeting households whose electricity consumption is below 300 kilowatts per month, which typically includes poor and lower middle class, Singh emphasised.

Elaborating on the cost dynamics, the Minister said that cost of installing one kilowatt (KW) of solar RTS is roughly around ₹50,000. One KW will typically give 120 units per month.

“Householder has to do nothing and will get the benefit of free 300 units per month. After 10 years, the benefit of excess units will also go to the householder. The SPV will repay the loan and CPSU will exit by handing over the system to the householder,” Singh said.

At present, the CPSEs are in the process of reaching out to such households and carrying out surveys for available rooftop space.

When asked about the total beneficiary families that can be included in the scheme, Singh said “One crore is an indicative target. It may go up, most likely.”