In a key announcement during her budget presentation on Tuesday, Finance Minister Nirmala Sitharaman unveiled a significant expansion in support for solar energy
In its Budget, the government has proposed to broaden the list of capital goods exempt from customs duties aimed at enhancing the manufacturing of solar cells and panels. This move underscores the administration's commitment to advancing solar energy as a vital component in the fight against climate change.
A cornerstone of the Budget is the launch of the PM SuryagharMuft Bijli Yojana, which will install rooftop solar panels across 1 crore households. This initiative promises to provide up to 300 units of free electricity per month, potentially saving households between Rs 15,000 and Rs 18,000 annually. Households will also have the opportunity to sell surplus electricity back to distribution companies, promoting further adoption of solar technology.
The Budget also introduces a new policy to support pump storage projects, aimed at ensuring continuous energy availability. Additionally, a notable joint venture between NTPC and BHEL will develop an 800 MW supercritical thermal power plant designed to deliver higher efficiency in energy production.
The finance minister reiterated the country’s ambitious goal of generating 500 GW of renewable energy by 2030 and reducing reliance on fossil fuels. The increased focus on solar energy is evident from the substantial Rs 7,327 crore allocated to the sector in the 2023-24 Union Budget, marking a 48 percent rise from the previous fiscal year.
The Pradhan Mantri Suryodaya Yojana, launched in January, is designed to enhance rooftop solar installations. The programme is expected to create opportunities in the electric vehicle (EV) charging infrastructure and generate employment for skilled workers involved in installation and maintenance.
Despite ambitious targets set in 2014 for rooftop solar energy, which aimed for 40 GW by 2022 as part of a broader 100 GW solar power goal, progress has been slower than anticipated. As of the end of 2023, rooftop solar capacity reached only 11 GW, compared to the target of 40 GW.
To support this sector, the government has increased financial assistance for residential rooftop solar projects, with higher support levels for systems up to 10 kW. The updated financial aid includes Rs 18,000 per kW for capacities up to 3 kW and Rs 9,000 per kW for capacities between 3 kW and 10 kW in general states.
These measures reflect the government's continued efforts to accelerate the adoption of renewable energy and achieve its long-term sustainability goals.