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The Ministry of New and Renewable Energy has recently unveiled a significant augmentation in residential subsidies for rooftop solar, for the year 2024. The Global Risk Report 2023 from the World Economic Forum has outlined the top 10 risks facing our planet in the coming 2 and 10 years. Over the next 2 years, 'Natural disasters and extreme weather events' claim the second position, while in the subsequent decade, the paramount risk is identified as 'Failure to mitigate climate change.' Evidently, the urgency to address climate change is imminent, necessitating collective efforts from every nation.
India, recognizing the gravity of the situation, has undertaken various measures to combat climate change. A pivotal initiative involves the shift towards green and clean energy, highlighted in India's Budget 2023 as one of the seven key priorities. The beginning of the year 2024 was marked by the PM announcing the Pradhanmatri Suryodaya Yojana promising the solarization of 1 crore households in India. In alignment with this scheme, the Ministry of New and Renewable Energy's decision to amplify subsidies is geared towards fostering the adoption of solar energy within the residential sector. The objective is to make such environmentally friendly options financially accessible to homeowners, ensuring not only immediate relief on energy bills but also fostering long-term cost savings. This strategic move aims to empower individuals to make eco-conscious choices without compromising their financial well-being, marking a crucial step in the nation's commitment to mitigating climate change.
The MNRE's initiative is poised to enhance the widespread adoption of solar power among residential homeowners. This aligns with our government's broader goal of increasing the utilization of clean and green energy, propelling India a step forward in leveraging renewable energy resources.
Under the revised subsidy scheme implemented by MNRE earlier this year, residential solar rooftop systems with an installation capacity ranging from 1 to 3 KWP will now receive Rs. 18,000/- per KWP, a notable increase from the previous rate of Rs. 14,588/-. Additionally, those opting for solar rooftop systems with a capacity between 4 to 10 KWP will be eligible for Rs. 9,000/- per KWP, compared to the earlier subsidy rate of Rs. 7,294/- per KWP. This adjustment in subsidy rates is anticipated to incentivize and facilitate the installation of solar power systems, fostering greater reliance on renewable energy in India.
States falling under the special category will have higher subsidy rates. Residential solar rooftop systems with an installation capacity of 1-3 KWP in these states will receive Rs. 20,000/- per KWP, while those opting for solar rooftop systems with a capacity of 4-10 KWP will be eligible for Rs. 10,000/- per KWP.
The special category states are:
Assam and all other north east states
Uttarakhand and Himachal Pradesh
Jammu & Kashmir and Ladakh
Andaman & Nicobar and Lakshadweep
The Central Finance Assistance (CFA) for solar panel installation is directly transferred to the bank account of the consumer.
What motivates our government to provide solar subsidies?
The primary goal is to diminish reliance on fossil fuels, fostering a shift towards sustainable energy sources. Additionally, the initiative aims to stimulate economic growth by generating job opportunities across various sectors, including manufacturing, installation, maintenance, and research & development in the field of solar technologies.
The support for technological advancement is crucial for research and development efforts, facilitating the production of low-cost and affordable solar panels. This, in turn, promotes increased solar panel installations throughout the country.
The subsidy for solar panel installation plays a pivotal role in achieving renewable energy targets, contributing to the overall expansion of solar adoption in our nation.
Advantages of solar subsidies
Encouraging Greater Solar Adoption: The provision of solar subsidies aims to stimulate increased investment in solar energy-powered systems by offering incentives to individuals, businesses, and communities. This strategy is geared towards reducing dependence on non-renewable energy resources.
Financial Savings for Consumers: By enabling consumers to generate their own electricity through solar panels, the subsidy program assists individuals in saving a significant portion of their income.
Environmental Benefits: The implementation of solar subsidies contributes to a reduction in greenhouse gas emissions, such as carbon dioxide and other harmful pollutants. This, in turn, promotes a healthier atmosphere and a pollution-free environment, helping prevent respiratory diseases.
Energy Self-Reliance for India: A key objective of solar subsidies is to enhance India's self-reliance in the energy sector by diminishing reliance on imported fossil fuels. This strategic move aligns with the goal of achieving greater energy independence for the nation.
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