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Poor response from central PSUs for MNRE’s solar scheme

According to reports, the Ministry of New and Renewable Energy (MNRE) has re-issued a notification relating to a viability gap funding scheme meant for ‘central public sector undertakings and government of India organisations’ for putting up solar projects.

The scheme was announced in January, but out of the total capacity of 1,000 MW on offer, only half has been allocated so far.

On January 16, the MNRE launched the scheme that promised to grant Rs. 1 crore per MW as ‘viability gap funding’ to central public sector undertakings and ‘government of India organisations’ that would put up solar plants. The Ministry allocated Rs. 1,000 crore for that purpose.

So far, only five organisations have taken up the proposal, including the Solar Energy Corporation of India, the agency that implements the scheme for a fee. Of the other four, only one – NTPC – is a PSU, the others are the Railways, Khadi Village Industries Commission and the National Institute of Food Technology Entrepreneurship and Management.

These five have been allocated capacities totalling 500 MW.

The MNRE has publicised the announcement again, calling the attention of CPSUs and government of India organisations to it, for the remaining 500 MW.

Notably, the notification of January 16, 2015, mentions NHPC, CIL, NTPC and Indian Railways by way of examples of organisations that may put up solar plants under the scheme.

Under the ‘salient features’ of the scheme it says, “1,000 MW of solar PV power projects would be set up by the CPSUs and Government of India organisations like NTPC, NHPC, CIL, IREDA, Indian Railways, etc.”

The scheme takes Rs. 6.91 crore a MW as the “estimated project cost”. The viability gap funding comes with a condition that the project developers should buy only locally produced solar cells and modules.

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