The solar industry believes access to finance, not sops, will be key for rooftop installations to take off, as it remains unruffled by the government’s recent proposal to cut subsidy.
Despite the provision of subsidies, solar rooftop installations have performed way below targets.
Of the 358 MW rooftop solar projects sanctioned by Ministry of New and Renewable Energy (MNRE), only 42 MW of rooftops have been installed so far.
The subsidy mechanism is seen as highly ineffective because not enough funds are made available, delaying or entirely stalling projects.
The firm projects India’s rooftop solar market capacity to reach 1500 MW by 2018, from 285 MW as of October 2014, driven mainly by commercial and industrial segments.
The government has set an ambitious target of adding 40,000 MW by 2022 through distributed and rooftop solar projects.
It aims to add 10,000 MW in the next three years.
These targets are part of the Indian government’s ambitious goal of achieving 100 GW by 2022 in solar.
Centre has planned to cut the subsidy on rooftop solar plants to 15 per cent from 30 per cent due to decline in price of solar panels, large target set for rooftop solar power plant and limited availability of funds for subsidy.
So, rooftops are already viable without subsidy for the commercial and industrial segments in several states.
These two segments account for more than half of capacity addition so far.
The residential segment, which is seen having a bigger potential, is also expected to be viable in the next few years.
Power tariffs in residential segment are now subsidised across the country.
The industry does welcome the RBI’s recent move to bring the renewable sector under the ambit of priority sector lending but it now wants the financing process to be free of hassles.