April 15, 2015: The government is planning to replace existent capital subsidy programme for rooftop solar power projects. This will be done with an interest subsidy scheme which will help speed up the development of solar power projects in India.
The MNRE has set an aspirant target of adding 100,000MW of solar capacity in India by 2022. This target is up from the current level of about 3000MW. A large share of 40,000MW is expected to come from rooftop solar projects where the government feels to provide assistance in order to keep the costs under control.
“The capital subsidy scheme has lived its utility and interest subvention would work best for the sector as this will help to reduce overall tariff from solar projects. The aim is to reduce effective interest rate for rooftop solar projects to around 8.5 per cent per annum that will help to reduce the levelised cost by around 10 per cent,” said a government official familiar to the development, reported mydigitalfc.
The government has made clear its intention to shift focus from capital subsidy structure to interest subsidy scheme during a meeting organised by MNRE.
