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Cabinet clears Rs. 8,100 cr to double solar parks capacity to 40GW

Enthused by the response it got in Madhya Pradesh, the Centre has decided to double the capacity target to be achieved by solar parks by 2019-20.

The Cabinet Committee on Economic Affairs on Wednesday approved reworking of the scheme for development of solar parks and ultra mega solar power projects as well as enhancing the capacity from 20,000 MW to 40,000 MW (or 40 GW) for the projects.

Will abate 55 mt of CO2

The projects will be set up with the Centre’s financial support of ₹8,100 crore. The total capacity, when operational, will generate 64 billion units of electricity annually that will lead to abatement of around 55 million tonnes of carbon-dioxide annually over its life cycle.

Briefing newspersons after the Cabinet meeting, Piyush Goyal, Minister of State (Independent Charge) for New and Renewable Energy, Power, Coal and Mines, said: “The enhanced capacity would ensure setting up of at least 50 solar parks each with a capacity of 500 MW and above in various parts of the country.”

Goyal said smaller parks in Himalayan and other hilly States, where contiguous land may be difficult to acquire in view of the difficult terrain, will also be considered.

The capacity of the solar park scheme has been enhanced after considering the demand from the States. The solar parks will be developed in collaboration with State governments/UTs.

The State governments/UTs will select the developer and also identify the land. It will then send a proposal to the Ministry of New and Renewable Energy (MNRE).

The developer will then be sanctioned a grant of up to ₹25 lakh to prepare a Detailed Project Report. Thereafter, Central Financial Assistance of up to ₹20 lakh/MW or 30 per cent of the project cost including grid-connectivity cost, whichever is lower, will be released as per the milestones set in the scheme.

Solar Energy Corporation India will administer the scheme under the direction of the MNRE.

The MNRE is already implementing a scheme to develop at least 25 solar parks with an aggregate capacity of 20,000 MW, which was launched in December 2014. As on date, 34 solar parks of aggregate capacity 20,000 MW have been approved and are at various stages of development.

Mytrah EnergyManaging Director and CEO Vikram Kailas said, “The hiked capacity reflects on one of the many opportunities to grow in India’s clean energy sphere.”

Explaining that the volume of power generated can comfortably offset the lower tariffs, Kailas said, “We expect solar tariffs to remain near the levels of the Rewa project.” For the 750 MW plant in Madhya Pradesh, winning bids hit a record of ₹ 2.97 per kilowatt-hour (kWh). This was the country’s first Ultra Mega Solar Power Project to call for bids.

Domestic manufacturing

Goyal said the government is also working on a policy to encourage solar equipment manufacturing. “There is considerable interest to set up solar equipment manufacturing in India. After consultation with the Ministry of Electronics and Information Technology, the benefit of M-SIPS will also be extended to solar equipment manufacturing in India.”

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