MNRE Reduces Solar Tariffs for Defense VGF Program


The Ministry of New and Renewable Energy (MNRE) has proposed amendments to the guidelines for the implementation of Defense Viability Gap Funding (VGF) Program. The fixed tariff for these projects has been reduced to Rs.4.50 (~$0.06735)/kWh from the previous Rs.5.50 (~$0.8232)/kWh.

The upper limit of VGF has been reduced to Rs.0.011 billion ($164,637)/MW for all project sizes. Earlier, a different VGF rate was provided for different project sizes:

  • Category I: Rs.25 million (~$374,176)/MW for projects of up to 5 MW
  • Category II: Rs.20 million (~$299,341)/MW for project capacity ranging from a minimum of 5 MW to a maximum of 25 MW
  • Category III: Rs.15 million (~$224,506)/MW for project capacity more than 25 MW

Under the Defense VGF Program, 347 MW of solar projects have been approved compared to the set target of 300 MW.