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Government halves the size and financial aid for its largest-ever rooftop solar project

Government halves the size and financial aid for its largest-ever rooftop solar project


The renewable energy ministry has halved the size of its largest-ever rooftop solar tender and also cut the financial assistance offered for it. Ashvini Kumar, managing director of state-run Solar Energy Corporation of India (SECI), which had released documents related to a tender for installation of 1GW of rooftop solar plants across buildings of 12 central ministries, told ET the tender size has been reduced to 500 MW. He did not provide any more details. The 1 GW project would have doubled India’s rooftop solar capacity from 1020 MW as of end October 2016. The tender also incentivised speedy completion of projects by linking the government’s financial assistance to it.

For instance, in all states, apart from the special category ones, developers would get Rs 18,750 per KW as assistance if they completed at least 80% of the project within 15 months. Projects in special category states —mostly the hill states —would get Rs 45,000 per KW under the same terms. The figure was progressively lowered, depending on the extent of completion, while those who failed to get at least 40% of their project done in 15 months would get no assistance at all. An official who did not wish to be named, said, the ministry of new and renewable energy (MNRE) has now earmarked Rs 1,040 crore as the total amount that will be available as financial assistance for the project.

It has also slashed the assistance offered across the board — for instance, those completing 80% of their project in 15 months will now get Rs 16,250 per KW in the general category states and Rs 39,000 per KW in the special category ones. The actual assistance may be even less as the ministry has ruled that it should be no more than 25% of the benchmark cost of the project in general-category states and 60% in the special-category ones. The benchmark cost will be the lowest cost quoted during the bidding process. “It is true that developers are unhappy with the changes,” the official said. “Calculation of the roof area has been done aggressively,” said Sunil Bansal, general secretary, Rajasthan Solar Association. A developer who did not want to be named, said, “There is nobody at SECI at present to take ownership of rooftop development.” SECI’s Kumar refuted both allegations.

Of the 500 MW, 150 MW will be set up under the capex model (where the building owner also owns the solar project) and 350 MW under the resco model (where the building owner leases the roof to the developer). According to SECI calculations, there is space available to set up 1,105.31MW of solar plants across 12 ministry building rooftops. Some ministries own staggeringly large rooftops —the SD Agricultural University in Palanpur, Gujarat, for instance, has enough rooftop space to install 375.67 MW of solar modules.

Anand Gupta Editor - EQ Int'l Media Network


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