The Cabinet Committee on Economic Affairs on Wednesday approved an increase in the budget for implementation of grid-connected solar rooftop systems to Rs.5,000 crore from Rs.600 crore up to the financial year 2019-2020.
This will support installation of 4,200 MW solar rooftop systems in the country in next five years, according to an official statement.
The capital subsidy of 30 per cent will be provided for general category States and Union Territories and 70 per cent for special category States, including Uttarakhand, Himachal Pradesh, Jammu & Kashmir, Lakshadweep, Andaman & Nicobar Islands and those in the North-East.
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There will be no subsidy for commercial and industrial establishments in the private sector since they are eligible for other benefits such as accelerated depreciation, custom duty concessions, excise duty exemptions and tax holiday.
The capacity of 4,200 MWp will come up through the residential, government, social and institutional sector, according to the statement, adding industrial and commercial sector will be encouraged for installations without subsidy.
“This will create the market, build the confidence of the consumers and will enable the balance capacity through market mode to achieve the target of 40,000 MWp by 2022,” according to the statement.
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The government has revised the target of National Solar Mission (NSM) from 20,000 MWp to one lakh MWp by 2022. Of that, 40,000 MWp is to come through grid connected solar rooftop systems. This approval, according to the government, will boost the installations in a big way and will act as a catalyst to achieve this goal.