Pradhan Mantri Suryodaya Yojana and The ABCD of Solar Energy in India

Pradhan Mantri Suryodaya Yojana and The ABCD of Solar Energy in India [Credit-SYR]

In the last decade, Indian households have shown interest in green energy solutions that have led to increased awareness of solar rooftop panels. However, the country's progress on this front could not be counted as stellar, with only 7-8 lakh households currently powered by solar energy.

The announcement of Pradhan Mantri Suryodaya Yojana [PMSY] by PM Modi on January 22 might grace the installation of solar rooftop panels. The PMSY scheme will cover 10 million households and bring them under the solar energy umbrella.

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Reasons for Lacking of Rooftop Solar [RTS] Capacity:

According to sources, since 2016, Rooftop solar [RTS] capacity in India has grown to 2.7 gigawatts [GW]. The Ministry of New and Renewable Energy [MNRE] rolled out the Second Phase of the Rooftop Solar Programme in 2019 to achieve 40 GW of solar power.

With the launch of Pradhan Mantri Suryodaya Yojana [PMSY], more people will adopt solar energy and could see an acceleration in the future. According to Vikas Agarwal, Co-founder and CBO of Credit Fair, The RTS adoption did not gain the desired momentum for two reasons.

Reasons for Lacking of Rooftop Solar [RTS] Capacity [Credit-SPS Ltd.]

One is the unawareness among people, and the second is the unavailability of easy RTS finance. With the launch of PMSY, we are hopeful that with government support, the RTS demand and adoption will increase in the coming years.

Mr. Vikas shared the details of his company 'Credit Fair,' a consumer lending fintech start-up that offers personal loans to set up RTS units at an interest rate of 8-10% and no-cost EMIs. 

The company has contributed to installing panels in more than 2000 households by the day. Currently, around 7-8 lakh houses have the RTS facility. After the launch of PMSY, as per the GOI and PM Modi's vision, we are determined to contribute 1 million of residential rooftop solar across the country in the next 5 years.

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Costs Per Unit to Install Rooftop Solar [RTS]:

Commonly called RTS panels are known as Photovoltaic panels. These panels are installed on the roofs of buildings and connected to the 'main' power supply unit. The RTS installation reduces reliance on grid-connected electricity and saves costs for consumers.

There are two major expenses for installing an RTS unit, the initial capital investment and the maintenance costs. The cost can range from Rs. 2.20 lakh to Rs. 3.5 lakh for a house with an average of 3-5 KW capacity.

Mr. Agrawal added that this cost can be managed through manageable EMIs of around Rs. 4000-5000 per month. It might be equivalent to their monthly electricity bills.

Costs Per Unit to Install Rooftop Solar [RTS] [Credit-Renew. India]

With easy financing through Credit Fair, the consumer can pay an easy EMI of around Rs. 5000/ month. We have tried to maintain EMI equal to their electricity bills, so there is no additional burden of EMI on them.

Navitas Solar, another RTS Firm, stated that the average electricity consumption per month for a 3 KW solar plant is 360 Units or kWH. A 3 kWh Solar Plant would require approximately 300 sq ft of shadow-free space for its installation.

Hence, total yearly savings from a 3 kW RTS panel would be Rs. 30,240. A 3 kW solar system generally costs around Rs. 1,22, 979 without the government subsidy. For a residential RTS, a 40% subsidy is provided by the government.

So with the govt-subsidy, the same RTS system will cost around Rs. 73,787. It also includes several other factors like increasing grid electricity tariff rates, availability of financial incentives, net metering, and ease of installation with EPC that affect the payback period. The payback period for the RTS system is 2-3 years.

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Other Benefits of RTS Energy System:

However, the payback period for the RTS system is 2-3 years. The whole process is made more financially sound via the Net Metering concept. In a Net Metering process, any surplus energy generated by the solar panels is redirected back into the grid.

The Net Metering System enhances the earning users' credits to offset future utility bills. It substantially reduces overall electricity bills by balancing the contributed and consumed procedures.

The government is also offering subsidies to ease the RTS installation cost. Homeowners and housing societies can receive Rs. 9000-18000 per kW for installing RTS up to 10 kW under the RTS Program Phase-2. 

Rooftop Solar System Capacity	Applicable Subsidy (₹)
Up to 3kW	18,000/kW
Above 3kW and up to 10kW	9,000/kW*
Above 10kW	1,17,000**
Note: *Rs.18,000/kW for the first 3 kW and Rs.9,000/kW for the rest of the capacity up to 10 kW. *-The subsidy amount is fixed for rooftop solar systems above 10kW capacity.

Many other institutions, like Digital Lender, are facilitating the RTS installation process by partnering with local installers and ensuring quick, easy loan disbursal.

Other Benefits of RTS Energy System [Credit-ABP News]

These RTS installation programs also have a significant environmental impact. It may curtail 13,000+ tons of carbon emissions, which is equivalent to planting over 5 lakh trees. They have also saved around Rs. 12 crore in yearly electricity costs, supporting the economy's parameters.

The government has set a target of 40 GW of annual solar power generation for the next 5 years. By 2030, the government will reach a 500 GW non-fossil fuel capacity.

Thanks and Regards

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