The Ministry of New & Renewable Energy (MNRE) has relaxed the domestic content requirement (DCR) norms for solar cells under Component C of the PM KUSUM scheme till March 2024.

In August last year, the Ministry waived off domestic requirement norms for projects awarded on or before June 20, 2023. It said that it has again received various representations regarding extension of DCR waiver for solar cells under Component C (FLS) owing to the ongoing bidding process.

“In view of the difficulties faced by the stakeholders and SIAs, it has been decided that the provision of requirement of indigenous solar cells (DCR) under Component C (FLS) of the PM-KUSUM scheme has been relaxed till March 31, 2024,” it added.

Demand-driven scheme

PM-KUSUM or the Pradhan Mantri Urja Suraksha Evam Utthaan Mahabhiyaan is a demand-driven scheme and, therefore, quantities or capacities are allocated under the three components of the scheme based on demand received from the states.

The Component C under PM KUSUM is to achieve solarisation of 15 lakh grid-connected agriculture pumps through individual pump solarisation (IPS) and feeder level solarisation (FLS). The beneficiaries under Component-C can be individual farmers, water user associations, primary agriculture credit societies and community or cluster-based irrigation systems.

For agriculture feeder solarisation, a central financial assistance (CFA) of ₹1.05 crore per MW is provided. There is no mandatory requirement of financial support from participating states. The feeder solarisation can be implemented in CAPEX or RESCO (Renewable Energy Service Company) mode.

Besides, the CFA under Component C is 30 per cent of the benchmark cost or the tender cost, whichever is lower. State government subsidy is 30 per cent, and the remaining 40 per cent is to be paid by the farmer.

As of July 2023, in Component C, the Centre has sanctioned 1,21,930 pumps under individual pump solarisation (IPS) of which 1,519 pumps have been installed. Under the feeder level solarisation (FLS) 22,05,279 pumps have been sanctioned, while no pump has been installed so far.

Funds under the scheme are released based on progress of installation reported by the State Implementing Agencies (SIA) and provisions of the scheme guidelines.

PM KUSUM aims to add a solar capacity of 30,800 MW with total central financial support of ₹34,422 crore including service charges to the implementing agencies.