The government’s benchmark rates for solar rooftop projects have fallen about 20%, the fourth successive year of decline.
Rates have fallen by 22% for projects between 1 kW and 10 kW, currently averaging at around Rs 42 per watt. For projects having a capacity over 10 kW, the rates have fallen by 20%.
The ministry of new and renewable energy (MNRE) listed rates for projects having capacities for less than 1 kW, between 1 and 2 kW, and between 3 kW and 10 kW. Earlier, all these capacities came under the same umbrella. The two brackets above 10 kW (10kW to 100 kW and 100 kW to 500 kW) continued to be listed as well.
Some regions of the country come under a ‘special’ category, and attract a higher cost, due to the lack of an operational network at present. These include the northeastern states, Sikkim, Uttarakhand, Himachal Pradesh, Jammu and Kashmir, Ladakh, Andaman and Nicobar Islands, and the Lakshadweep Islands. On an average, the costs for the special states were Rs 4 to 5 per watt more expensive than the other states.
However, the rooftop solar programme (RTS), a big focus of the MNRE, has been lagging behind its target. Per industry sources, the current installed capacity of rooftop solar projects is less than 3 GW. The stated target for 2022 is 40 GW.
Experts said that the RTS was already facing many implementation challenges, despite plenty of incentives offered by the government. “RTS programme has not picked up even after such CFA (central finance assistance) schemes and net metering regulations. Some regulators are even thinking of rolling back net-metering regulations or levying additional charges, making it more difficult for developers,” Debasish Mishra, leader, energy resources and industrial products at Deloitte India, told ET.
Mishra foresees further problems with the programme, as Covid-19 further compounds the issues. “Covid-19 has severely impacted the demand from commercial and industrial consumers, which brings demand side challenges as well. Discoms will always be reluctant to promote the RTS programme as they end up losing high paying customers,” he said.