Incentives For Grid Connected Solar Power Projects

Grid Connected Solar Power Projects

In this post, incentives for grid connected solar power projects policy, major key points of policy, time line of projects are given.

• Implementation of central public sector undertaking (CPSU) scheme phase – II for setting up 12,000 MW grid connected solar photovoltaic power projects by the government producers with viability gap funding support for self use or use by government / government entities either directly or through distribution companies (DISCOMs) from financial year 2019 – 20 to 2022 – 23.

Grid Connected Solar Power Projects:  Key Points

The project cost for 12,000 MW solar power project is estimated as Rs. 48,000 crore. The required VGF support for this 12000 MW will be Rs 8,580 crore.

• The scheme will mandate use of both solar photovoltaic cells and modules manufactured domestically as per specification and testing fixed by MNRE.
• Any government producer setting up solar PV power project will be eligible for assistance under this scheme if solar PV plant for self use or use by government / government entities either directly or through DISCOMs.
• The viability gap funding shall be provided covering the difference between the domestically produced solar cells and modules and imported solar cells and modules.

 

Incentives - Grid Connected Solar Power Projects

• The permissible maximum VGF has been kept at Rs. 0.70 Cr / MW ( Rs. 0.55 Cr/MW from 10^th May, 2021 ), the actual VGF to be given under the scheme would be decided through bid parameter. The VGF will be released in two trenches (1) 50% on award of contract to EPC contractor (2) Balance 50% on successful commissioning of full capacity of project.
• The solar energy corporation of India (SECI) will be charged a fee of 1% of the VGF disbursed for conducting bidding, handling funds, monitoring project and managing all aspects of the scheme.
• The power produced by this scheme can be used for self-use or use by government entities either directly or through DISCOMs on payment of charges not more than Rs 2.80 per unit ( Rs 2.45 per unit from 10^th May, 2021 )

Grid Connected Solar Power Projects Time Line

• 500 MW Projects: Projects to be commissioned within 24 months ( Rs 2.45 per unit from 10^th May, 2021 )
•  from the date of letter of award for projects up to 500 MW
• More Than 500 MW Projects: Capacity of 500 MW to be commissioned within 24 months from the date of letter of award and balance capacity to be commissioned within next 6 months

 

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