Savings shine bright for existing rooftop solar beneficiaries, big hopes from PM Surya Ghar scheme

The government's interim budget introduced a significant initiative: the PM Surya Ghar: Muft Bijli Yojana, aimed at promoting rooftop solar installations. Prime Minister Narendra Modi announced an allocation of ₹75,000 crore for this scheme, targeting 1 crore beneficiaries. These beneficiaries would receive 300 units of free power monthly, resulting in an annual saving of ₹15,000 to ₹1,80,000 per year. The aim of this new rooftop solar scheme was to accelerate India’s transition to renewable energy, and has an outlay of ₹75,000 crores for 5 years.

This is the second scheme to promote installation of solar panels on rooftops. It is a new and improved version of a ₹11,800 crores rooftop solar scheme launched in 2014 which aimed for 40 gigawatts (GW) of solar energy by 2022. This deadline was extended to 2026, but as of November 2023, only 10.4 GW Gigawatt capacity had been achieved. But slow offtake doesn't mean that beneficiaries are unhappy with the scheme.

A resident of Kalkaji in Delhi, Vinod Saxena spent ₹6 lakh to install solar panels of 10 kW capacity and got ₹1 lakh in subsidy. Even as unused units of electricity get credited to his account under net metering, he is confident that may not get a bill, given the amount of power being generated. Net metering is a billing system whereby a consumer who generates electricity can use any excess energy generated at any point in the future, at no extra cost.

The allocation of the earlier rooftop solar scheme was roughly ₹12,000 crores, the government has now decided to give a big boost to the scheme with a ₹75,000 crores allocation. Beneficiaries get 300 units of free electricity per month. Consumers would get subsidies in the range of ₹30,000 to ₹78,000 for solar systems, collateral-free low interest loans and beneficiaries may even earn some income through sale of surplus power generated from their rooftop solar panels to discoms.

Industrial users of solar energy who avail the solar energy subsidy offered by Delhi State, and not Central Subsidies, are also seeing benefits. Matu International, a manufacturer of textile machinery spare parts in East Delhi's Jhilmil Industrial Area, got solar panels installed in 2023 at a cost of ₹50 lakh. While the company doesn't get a power bill for most months of the year as solar energy covers its factory and office's power consumption, it hopes to recover the investment in 3 to 5 years. Around a dozen kilometers away, the Bal Mandir school in Delhi's Laxmi Nagar has also witnessed a significant reduction in its electricity bill due to net metering.

Stressing on the importance of a fully integrated supply chain in India, MNRE Secretary Bhupinder Singh Bhalla termed manufacturing and PLI schemes for high efficiency solar modules as a big focus. But experts say, there are multiple reasons the earlier scheme did not take off as well as earlier expected – from cumbersome paperwork for individuals interested in installing rooftop systems, to finding and negotiating with installation providers, to obtaining clearances from discoms.

Many also point out that beneficiaries have been facing delays in subsidy disbursements. A resident of Greater Kailash in New Delhi, Subhash Jain is still awaiting the subsidy of ₹1.17 lakh which was approved but is yet to be credited to his account. He feels that schemes lose charm among people if money isn't disbursed timely.

Smoothening out many of these wrinkles will mean that the new avatar of the rooftop solar energy scheme sees some strong traction, and that will be a big plus for the government, which hopes that the new and improved scheme will accelerate India’s adoption of solar energy in the overall renewable energy mix and get it closer to its green energy targets.