Union Cabinet approves Rs 75,000 crore rooftop solar scheme to empower 10 million homes

In a significant move towards sustainable energy and household savings, the Union Cabinet has given its nod to a Rs 75,021 crore rooftop solar scheme. This ambitious initiative, named the PM Surya Ghar Muft Bijli Yojana, aims to subsidize the installation of solar power equipment on the rooftops of 10 million homes, alleviating pressure on electricity grids and fostering a greener environment.

Under the approved scheme, the government will offer financial assistance or subsidies for the installation of solar power equipment based on capacity. Homes opting for 1 kW systems will receive a Rs 30,000 subsidy, while those installing 2 kW and 3 kW rooftop systems will be entitled to Rs 60,000 and Rs 78,000 subsidies, respectively.

Beneficiaries under the scheme will not only enjoy free electricity of up to 300 units per month from the grid but will also have access to collateral-free, low-interest loans to facilitate the installation of solar power equipment. This multi-faceted approach aims to make sustainable energy solutions accessible and affordable for a broader segment of the population.

As solar power currently constitutes approximately 17% of India's overall power capacity, this scheme has the potential to revolutionize the landscape, adding an estimated 30 GW of solar capacity across the country. This would not only result in substantial household savings but also contribute to reducing emissions, equivalent to Rs 720 million tonnes of carbon dioxide over the 25-year lifespan of the rooftop systems, according to government estimates.

To further encourage the adoption of rooftop solar power in rural areas, the government plans to establish a 'model solar village' in each district across the country. Union Minister for Information and Broadcasting, Anurag Thakur, emphasized this development during a post-cabinet meeting announcement on Thursday.

Finance Minister Nirmala Sitharaman had previously highlighted the significant impact of the scheme while presenting the interim budget for FY25 on February 1. She mentioned that the 10 million beneficiaries stood to save Rs 15,000-18,000 annually on their electricity bills.

The implementation of the scheme will be facilitated through special purpose vehicles established by central public sector enterprises designated for each state. REC Ltd, a state-run entity, will take on the role of the implementing agency for this transformative rooftop solar initiative.