REC to lend Rs 1.20 lakh cr to power PSUs for solar rooftop projects
The announcement of the Rural Electrification Corporation (REC) being chosen as the nodal agency for the implementation of the Pradhanmantri Suryodaya Yojana (PSY) marks a significant step in India's journey towards embracing renewable energy. Under this initiative, REC is set to extend a substantial line of credit, amounting to Rs 1.20 lakh crore, to propel the installation of rooftop solar systems in one crore households across the country.
This initiative is part of a broader push towards green energy in India, aligning with the country's commitment to increase its use of renewable energy sources. The role of REC in this ambitious project is multifaceted. While REC will not directly fund the installations in individual households, it will provide financial assistance to various Central Public Sector Enterprises (CPSEs). These CPSEs, which include prominent names like NTPC, NHPC, Power Grid, SECI, SJVN, THDC, NEEPCO, and EESL, have been allocated to different states across India for the installation of these systems.
The overarching goal of this initiative is to install a total of 40 GW of rooftop solar systems by 2026. This includes a target of 10 GW in the residential segment under the Pradhanmantri Suryodaya Yojana. Achieving such a target will necessitate extensive coordination among multiple stakeholders, including the owners of the rooftops, power distribution companies, vendors, and financing companies.
The scheme also envisages potential changes in government subsidies to further incentivize the adoption of solar energy. Currently, the scheme offers up to 40 percent subsidy for systems with 1-3 kW capacity and 20 percent for capacities above 3 kW. The Ministry of New and Renewable Energy (MNRE) is considering revisions to these subsidies to make rooftop solar installations more accessible and affordable.
REC's commitment to this project is evident in its financial planning and coordination efforts. The corporation has already sanctioned about Rs 1.25 lakh crore for the renewable energy sector, indicating its serious investment in India's green energy future. As of now, India's current grid-connected solar rooftop capacity stands at 11.08 GW, which is part of the total solar capacity of 72.31 GW. In line with the government's energy transition plans, solar power is expected to play a significant role, accounting for 292 GW of the total 500 GW renewable capacity by 2030.
This move is not only a major step towards meeting India's renewable energy goals but also reflects the country's commitment to sustainable development and reducing its carbon footprint. The successful implementation of this scheme could serve as a model for other countries looking to make a similar transition to renewable energy sources.
