Interim Union Budget 2024/25 Brings Exciting Update For the Rooftop Solar Market in India

Arpit | 1st February 2024

The interim Union Budget 2024/25 heralds a significant leap for India's rooftop solar market with the announcement of the Pradhanmantri Suryodaya Yojana. Envisioned by Finance Minister Nirmala Sitharaman, this scheme is poised to electrify the nation's renewable energy landscape by offering up to 300 units of free electricity monthly to beneficiaries. This ambitious initiative targets 10 million households, enabling them to not only harness but also sell surplus solar energy, fostering a self-sustaining energy ecosystem.

The scheme's unveiling comes at a critical juncture, as India strives to ramp up its rooftop solar installations. Despite setting a lofty target of 40 GW by the end of 2022, the progress has been sluggish, with less than 15% of the goal achieved by mid-2021. However, the Pradhanmantri Suryodaya Yojana aims to inject new momentum into this sector, promising to bridge the gap towards achieving India's renewable energy ambitions. This on the back of various state lead subsidy updates promises well for the sector.

The state-run REC has been entrusted with this initiative, with a robust financial mechanism in place to support the widespread installation of rooftop solar panels. This move is expected to catalyze a domino effect, benefiting not just the direct recipients but also stimulating growth across the solar value chain - from panel manufacturers to installers, contributing to job creation and technological innovation.

Moreover, the government's proactive approach in revising the Central Financial Assistance for residential solar rooftop projects further sweetens the deal for homeowners, making the adoption of solar power more appealing than ever. With additional financial incentives now accessible through the national solar rooftop portal, the path to solar adoption is clearer and more enticing for Indian households.

MYSUN's Take:

"The interim Union Budget 2024 marks an important milestone in democratization of solar energy in India with the Pradhanmantri Suryodaya Yojana, which promises 300 units of free power monthly to households. Aiming to reach 10 million homes, this initiative not only promotes sustainable energy but also paves the way for a substantial 50GW boost in rooftop solar (lets say average system size of 5kW/home), akin to the landmark 100GW solar mission. It's a comprehensive move that promises to invigorate the solar ecosystem, from manufacturing to job creation, underscoring its critical importance in India's energy strategy."

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