PM-Surya Ghar – Muft Bijli Yojana

The PM-Surya Ghar – Muft Bijli Yojana is an innovative government initiative launched on February 15, 2024. This scheme aims to promote the adoption of rooftop solar systems across Indian households. It focuses on reducing electricity costs and enhancing renewable energy usage. The Ministry of New and Renewable Energy (MNRE) has recently issued operational guidelines to facilitate the scheme’s implementation.

Key Features of the Scheme

The PM-Surya Ghar scheme aims to provide free electricity to households. It includes a subsidy for households to install solar panels on their roofs. The subsidy can cover up to 40% of the installation cost. The scheme is expected to benefit approximately 1 crore households across India. It is projected to save the government around ₹75,000 crore annually in electricity costs.

Implementation Models

The scheme offers two primary models for rooftop solar installation. The first model is the Renewable Energy Service Company (RESCO) model. In this model, third-party entities invest in the solar installations. Consumers only pay for the electricity they consume without any upfront costs. The second model is the Utility-Led Aggregation (ULA) model. Here, DISCOMs or designated state entities install rooftop solar systems on behalf of individual households. This model simplifies the process for consumers and encourages solar adoption.

Payment Security Mechanism

To support the RESCO model, a ₹100 crore corpus fund has been allocated for the Payment Security Mechanism (PSM). This fund aims to mitigate investment risks associated with grid-connected rooftop solar models. It may be supplemented by additional grants and other funding sources, subject to MNRE approval.

Central Financial Assistance

The scheme provides Central Financial Assistance (CFA) for solar systems. The CFA is structured to offer 60% support for 2 kW systems and 40% for systems between 2 to 3 kW. The maximum capacity eligible for subsidy is capped at 3 kW. For example, households can receive up to ₹30,000 for a 1 kW system, ₹60,000 for a 2 kW system, and ₹78,000 for a 3 kW system or higher.

Access to Financing

Households can access collateral-free low-interest loans for the installation of residential rooftop solar systems. The current interest rate for these loans is around 7%. This financial support encourages wider adoption of solar technology among households.

National Portal for Subsidy Application

Households must apply for the subsidy through the National Portal. This portal assists users in selecting suitable vendors for installation. It also provides essential information such as system sizes, benefits calculators, and vendor ratings. This resource facilitates informed decision-making for consumers.

Future Prospects

The PM-Surya Ghar scheme is step towards enhancing renewable energy adoption in India. It aims to create a sustainable energy future while reducing the financial burden on households. The innovative financing models and government support are expected to drive widespread implementation.

Questions for UPSC:

1. Discuss the role of renewable energy in achieving India’s energy security.
2. Critically examine the impact of government subsidies on the adoption of renewable energy technologies.
3. What are the challenges faced by the residential sector in adopting rooftop solar systems? Explain with examples.
4. Comment on the significance of public-private partnerships in the renewable energy sector in India.

Answer Hints:

1. Discuss the role of renewable energy in achieving India’s energy security.

1. Renewable energy reduces dependence on fossil fuels, enhancing energy independence.
2. It contributes to a diversified energy mix, improving resilience against supply disruptions.
3. Promotes sustainable development and helps mitigate climate change impacts.
4. Investment in renewables creates jobs and stimulates economic growth.
5. Government initiatives, like PM-Surya Ghar, encourage widespread adoption and innovation.

2. Critically examine the impact of government subsidies on the adoption of renewable energy technologies.

1. Subsidies lower the initial cost barrier, making renewable technologies more accessible.
2. They incentivize investments in clean energy, driving market growth and innovation.
3. However, reliance on subsidies can lead to market distortions if not phased out properly.
4. Long-term sustainability relies on creating a self-sufficient market without continuous government support.
5. Examples include the PM-Surya Ghar scheme, which provides financial assistance for solar installations.

3. What are the challenges faced by the residential sector in adopting rooftop solar systems? Explain with examples.

1. High upfront costs can deter households from investing in solar systems despite subsidies.
2. Awareness and understanding of solar technology and benefits are often limited among consumers.
3. Space constraints and structural issues in older buildings may hinder installation feasibility.
4. Regulatory challenges, such as obtaining permits and grid connectivity, can complicate the process.
5. Examples include urban households facing difficulties in roof space allocation for solar panels.

4. Comment on the significance of public-private partnerships in the renewable energy sector in India.

1. Public-private partnerships (PPPs) leverage resources and expertise from both sectors, enhancing project viability.
2. They promote innovation by combining public policy goals with private sector efficiency.
3. PPPs can facilitate large-scale renewable projects, reducing financial risks for both parties.
4. Examples include collaborations in solar parks and large-scale wind projects across India.
5. They also help in knowledge transfer and capacity building within the renewable energy sector.