The Bihar government has come up with a new renewable power policy for the state where it looks to set up over 3,400 Megawatt projects based on non-fossil fuel-based resources in the next five years. The policy is likely to spur investments to the tune of Rs 20,000 crore in energy projects, according to Centre for Energy and Environment Development (CEED), a non-profit organization active in Bihar’s energy space. The state’s Cabinet last week cleared the policy called ‘Bihar Policy for Promotion of New and Renewable Sources, 2017’ and is likely to notify the same soon. Under the policy, the state government is mulling setting up 2,984 MW capacity based on solar energy, 282 MW on biogas and 200 MW small hydropower plants. Of the total solar capacity, the state plans to set up 1,000 MW rooftop solar projects and 1,00 MW as mini grid projects.
Composed of solar modules, a battery bank, and an inverter, a mini-grid system can offer solar power as the primary power source and later switch to alternative power sources when solar power is insufficient for meeting demand. The renewable energy capacity addition of Bihar is in line with central government’s plan to have capacity of 175 Gigawatt built on alternative sources of energy by 2022. Of this 175 GW, the government plans to add 100 GW solar power capacity, 60 GW wind, 10 GW from biomass and 5 GW from small hydro projects.
“The policy is expected to open up massive new avenues for jobs and livelihood opportunities in the state; particularly in supply chain, operation, and maintenance for grid-connected and off-grid or decentralized renewable energy projects,” CEED said in a statement. It further said the policy provides a host of economic incentives to project developers for setting up renewable energy projects, which includes exemption of electricity duty, Value Added Tax (VAT), distribution charges and cross-subsidy surcharges. CEED said the provisions to de-risk private sector investment in mini-grid projects are also included in the policy given the fact that remote areas of Bihar possess huge potential for mini-grids and it is important to tap those potential with suitable investment climate.