India’s Solar Park Capacity Increase from 20 GW to 40 GW Has Been Approved

March 24, 2017


The enhancement of India’s solar park program from 20 GW capacity to 40 GW capacity has received final administrative approval.

The President of India has approved the implementation of program to enhance solar park capacity from 20,000 MW to 40,000 MW to develop a minimum of 50 solar parks of 500 MW each by financial year 2019-20, stated a Government release.

The Government of India will provide central financial assistance (CFA) of Rs.81 billion (~$1.23 billion) for development of these solar parks.

The Ministry of New and Renewable Energy (MNRE) will release CFA of Rs.2.5 million (~$0.038 million)/solar park to conduct detailed project reports and surveys. A CFA of Rs.2 million (~$0.030 million)/MW or 30 percent of the project cost will be released upon achievement of predesignated milestones.

The approved grants will be released as follows:

The grant for development of solar park and for development of external transmission will be distributed at a ratio of 60:40. Out of Rs.2 million (~$0.030 million)/MW, Rs.1.2 million (~$0.018)/MW will be provided to solar park project developer and Rs.0.8 million (~$0.012 million)/MW will be provided to central or state transmission utility to develop external transmission system.

It has been mandated by the MNRE that if the solar park is being developed in phases the CFA will be released in proportion to the expenditure in each phase. The MNRE has also directed that the solar park project developer must develop the internal transmission system to connect the project to the pooling substation.

Keeping in mind the recent Rewa solar park auction, the MNRE has stated that it will put in efforts to tie up with multilateral or bilateral funding agencies to finance the entire or a part of the cost of solar parks. To this end, the MNRE has stated that the grant provided as CFA to solar park project developers will be treated as their contribution towards availing this loan.

Mercom previously has reported that, 34 solar parks across 21 states aggregating 20 GW are under various stages of construction and completion, but have been affected by incomplete infrastructure.

To ease the hurdles faced by developers in solar parks, the MNRE will designate a nodal officer to help, guide, handhold and monitor the progress to ensure timelines are met and guidelines adhered to.