Mercom India’s Most Read News Stories from 2022
As 2022 draws to a close, we bring you our ten most popular articles from the year
December 30, 2022
Here is a collection of the most-read news stories and in-depth articles of 2022. Most of the top stories this year were from the rooftop solar segment. Other popular themes among readers included articles on auctions, policy changes, and their implications.
Residential Rooftop Solar Subsidies to be Directly Transferred to the Consumers
In June, the Ministry of New and Renewable Energy (MNRE) issued an easy procedure for installing residential grid-connected rooftop solar systems under its Rooftop Solar Program Phase II. The Ministry designed a national portal for the process of installing rooftop solar systems, starting from registering the applications to releasing subsidies to residential consumers’ bank accounts after installation and inspection of the plant, all of which can be tracked online on the portal. Under the new procedure, entities must open a zero-balance savings account in the Bank of Maharashtra for the subsidies to be credited.
Residential Rooftop Solar Systems Above 10 kW Are Eligible for Subsidy of ₹94,822
In August, the Ministry issued new and simplified central financial assistance calculations for rooftop solar systems installed by residential consumers. The government’s subsidy became available only to those registered on the national portal by December 31, 2022. The subsidy would be released after clearance by the inspecting authority (the regional power distribution company).
Solar Module Manufacturing PLI Auction Winners List Updated – Jindal Out, Adani In
In February, the Indian Renewable Energy Development Agency (IREDA) announced an updated list of successful bidders to set up manufacturing capacities for a minimum of 10 GW of vertically-integrated high-efficiency solar modules under the production-linked incentive (PLI) program.
Reliance New Energy Solar’s PLI award amount was increased to ₹19.17 billion (~$231.56 million) from the earlier ₹11.90 billion (~$143.74 million) for a capacity of 4 GW. Adani Infrastructure was awarded a PLI of ₹6.63 billion (~$80.08 million), out of the total quoted amount of ₹36 billion (~$434.86 million) for a capacity of nearly 737 MW under the bucket filling method, according to Mercom sources. Shirdi Sai Electricals PLI award stayed the same at ₹18.75 billion (~$226.49 million) for a capacity of 4 GW. According to IREDA sources, Jindal India Solar Energy, which was awarded a PLI of ₹13.90 billion (~$167.9 million), decided to opt out of the bidding process.
A 1 kW Residential Rooftop Solar System in Jaipur to Cost ₹43,500
Ajmer Vidyut Vitran Nigam in August, announced the lowest bids for 55 MW of rooftop solar projects under the capital expenditure (CAPEX) model for three power distribution companies (DISCOMs) in Rajasthan. The Ajmer DISCOM was assigned as the implementing agency in Rajasthan for MNRE’s grid-connected rooftop solar (GCRTS) program in residential buildings. The lowest bid discovered for installing systems under the Jaipur DISCOM jurisdiction for Part A (1 kW to 3 kW) was ₹43,500 (~$544)/kW; for Part B (>3-10 kW), the L1 price was ₹40,991 (~$512)/kW.
Ministry of Power Recommends Uniform Slab of 5% GST on All Renewable Energy Components
In March, the Ministry of Power (MoP) said it would write to the Department of Revenue recommending a uniform slab of 5% goods and services tax (GST) on all renewable energy components nationwide. The move came in the wake of NITI Aayog CEO’s letter to the Secretary of the Department of Revenue advocating a uniform GST slab on all renewable energy components.
Customs Authority Allows a Solar Developer to Import Modules at a Concessional Rate of 5%
The Customs Authority for Advance Rulings in July allowed the import of all the components for a solar project at a concessional rate of 5%, circumventing the basic customs duty impositions. To promote the local manufacturing of solar cells and modules, the government introduced several tariff barriers such as Safeguard Duty in the range of 25%-15%, which was in effect from July 2018 to Jul 2021, and Basic Custom Duty at 40% from April 1, 2022. These duties have increased solar project costs across the country, forcing developers to seek ways around these duties and save on costs.
Gujarat Allows Net Metering for Rooftop Solar Systems of 1 kW to 1 MW
Gujarat Electricity Regulatory Commission (GERC) in June amended Gujarat Electricity Regulatory Commission (Net Metering Rooftop Solar PV Grid Interactive Systems) Regulations, 2016. The new regulation states that net metering will be allowed for rooftop solar systems having a capacity of 1 kW and up to 1 MW. Gross metering for rooftop solar systems with 10 kW and up to 1 MW capacity will be permitted. Rooftop solar projects set up by residential consumers will be allowed irrespective of the sanctioned load. There will be no capacity restrictions up to the sanctioned load demand for captive consumers and projects set up under third-party sale within the permissible limit.
Solar Industry Confused About GST Rates and Application
The GST council, in September 2021, announced the GST increase for ‘specified renewable energy parts’ from 5% to 12%, which came into effect the following month. With the rising ambiguity around managing project costs with the increase in the GST rate, many developers raised their concerns to the government, requesting an immediate solution. The confusion was around using the word ‘solar power generating systems,’ which was all-encompassing and included solar power projects.
Tata Power Solar Wins India’s Largest EPC Contract to Develop 1 GW Solar Project
In May, SJVN announced it awarded the engineering, procurement, and construction (EPC) contract for its 1 GW solar project in Bikaner, Rajasthan, to Tata Power Solar Systems. The project will be developed at an estimated cost of ₹54.91 billion (~$663.46 million), making it India’s biggest solar EPC contract. The project is scheduled to be completed in 24 months from the issuance of the EPC contract, i.e., May 2024. It is expected to generate 2,454.55 million units (MU) in the first year, and on a cumulative basis, approximately 56,838.32 MUs will be generated in 25 years and is likely to reduce 2.78 million tons of carbon dioxide emissions in 25 years.
SJVN, Juniper Green, Tata Power, SAEL, and Avaada Win MSEDCL’s 500 MW Solar Auction
SJVN Green Energy, Juniper Green Energy, Tata Power Renewable Energy, SAEL, and Avaada Energy were declared winners in Maharashtra State Electricity Distribution Company’s (MSEDCL) auction to procure power from 500 MW of grid-connected intrastate solar projects (Phase-VII) on a long-term basis. SJVN and Juniper won 200 MW and 75 MW capacity, respectively, with each quoting ₹2.90 (~$0.035)/kWh. Tata Power and SAEL won a capacity of 150 MW and 50 MW, respectively, with each quoting ₹2.91 (~$0.035)/kWh. Avaada quoted ₹2.91 (~$0.035)/kWh for 300 MW but was only awarded 25 MW under the bucket-filling method.