India to install 4.2 GW of rooftop solar under increased budget

India’s Cabinet Committee on Economic Affairs, chaired by Prime Minister, Shri Narendra Modi, announced on December 30 that it has upped its budget for rooftop solar PV deployment, from INR 6 billion (around $90.2 million) to INR 50 billion (around $751.8 million) up until 2019-20.

The aim is to install 4.2 GW of grid connected rooftop solar PV systems over the next five years in the residential, government, social and institutional sectors. A capital subsidy of 30% will be provided for general category states, and union territories of which there are seven; while 70% will be given to special category states i.e., North-Eastern States, including Sikkim, Uttarakhand, Himachal Pradesh, Jammu & Kashmir and Lakshadweep, Andaman & Nicobar Islands.

Commercial and industrial rooftop installations will not receive the subsidy, as they are eligible for other benefits, including accelerated depreciation, custom duty concessions, excise duty exemptions and tax holidays, said the government.

Of the 100 GW of solar PV targeted by 2020, 40 GW are expected to be installed in the rooftop sector. The government statement did not outline how this figure is to be achieved.

Bridge to India, which released a solar rooftop map for 2016 last November, calculated that cumulative solar PV rooftop capacity, as of October 31, 2015, was just 525 MW, of which residential comprised 143 MW, commercial 172 MW and industrial 210 MW. It projects that 6.5 GW will be installed by 2020. Meanwhile, in a report also released in November, KPMG India forecast that 10 GW of will be installed by 2020, and up to 49 GW by 2025.

In its December 30 statement, the government said that to date, 26 Indian states have some form of net metering/gross metering facilities in place to support rooftop installations.

"Today it is possible to generate solar power from the solar rooftop systems at about Rs.6.50/kWh. This is cheaper than the diesel gen-sets based electricity generation. It is also cheaper than the cost at which most DISCOMs would make power available to the industrial, commercial and high-end domestic consumers," read the statement.

In its November report, KPMG India said rooftop solar, combined with storage, will be cheaper than grid power after 2022.