Solar Subsidy
Solar Subsidy in India Explained (2023)
To boost the usage of solar energy in the residential sector, India has a solar subsidy programme in place. It reduces the financial burden of installing solar panels, by providing financial assistance to consumers.
With this incentive, residential consumers can save up to 40% of their installation cost. Moreover, individuals from across the country can apply for these grants. But how much is the incentive and how can individuals claim it? Let’s understand it further
Central Financial Assistance
At the end of 2022, the Indian government announced that it was implementing the Rooftop Solar Programme Phase II. Under the scheme, the Ministry of New and Renewable Energy (MNRE) will provide Central Financial Assistance to residential consumers for installing rooftop solar systems (RTS).
The programme will be implemented by DISCOMs and respective state agencies. The best part about the CFA is that it offers direct benefit transfer (DBT), i.e. consumers will directly receive the incentive in their bank accounts.
Who is the CFA for?
Currently, CFA is available to residential consumers with a grid-connected solar plant. Moreover, group housing societies and RWAs of solar capacities up to 500kW can also avail the incentive.
MNRE has set certain stipulations that have to be met to avail the subsidy, which we will discuss in the coming sections. First, let’s break down the subsidy amount.
Cut Down Your Energy Cost by Almost 80%
How much is the Solar Subsidy in India?
With the introduction of the CFA, subsidy calculations have been largely simplified. Also, the incentive amount is equal for consumers from all states, except the northeastern states and certain union territories.
The details are as follows:
Solar Subsidy for North Eastern/UTs/Hilly States
These prices are applicable across most of countries. However, to promote solar adoption in northeastern states and those with difficult hilly terrains, including Sikkim, Uttarakhand, Himachal Pradesh, UT of Jammu & Kashmir, Ladakh, Lakshadweep, and Andaman & Nicobar Islands, MNRE offers a slightly higher CFA.
The details are as follows:
Note: The CFA is calculated based on either the module capacity or the inverter capacity, whichever is lower.
Apart from this, certain Indian states such as Jammu and Kerala also provide their own separate state solar subsidy in addition to the CFA to promote clean energy adoption.
However, as the government moves towards a uniform solar subsidy, there is limited clarity on how long such state-specific incentive schemes will be in place.
How to Apply for Solar Subsidy?
Recently, the government launched the National Portal for Rooftop Solar, to make the process for applying for solar much simpler. Now, a consumer from anywhere across India, can directly apply for a solar subsidy online, and track the entire process from application to the transfer of subsidy funds into the bank account.
To be eligible for the grant the following criteria have to be met:
Steps to Avail the Subsidy
- Register and submit your application at www.solarrooftop.gov.in. No vendor or third party is allowed to do so on the beneficiary’s behalf.
- The DISCOM will conduct a technical feasibility study within the next 15 days.
- Once approved, you can install the system through registered vendors.
- After installation, you can apply for net metering and the request will be forwarded to the DISCOM.
- There will be an inspection of the plant and if all guidelines were met, a commissioning certificate will be issued.
- Once you submit your bank details in the portal, the funds will be credited to your account in 30 days.